Interim Financial Reporting Essay Example | Topics and Well Written Essays - 2000 words

temporary Financial Reporting - Essay ExampleThe fundamental goal of retardation financial reporting is to boon regular and timely evaluations of a businesss performance. There be certain intrinsic limitations of stave reporting. Owing to the shortened time periods involved, inaccuracies in assessment and allocation are amplified. The consequences of seasonal fluctuations, as fountainhead as momentary market circumstances, further limit the dependability, comparability and extrapolative significance of impermanent reports (Motiwalla, 2003). IAS 34 & retardation Financial Reporting The IFRS had formulated several accounting stock(a)s that are supposed to be observed by business organizations while preparing their accounting reports. The accounting standard IAS 34 delineates the requirements for the preparation of interim financial reports. IAS 34 is applicable when a business organisation chooses to skip an interim financial report that is compliant with the IFRSs. ... his s tandard also recommends codes for recognition and measurement in the preparation of comprehensive or abridged financial statements for a provisional time period. Apt and consistent interim financial reporting enhances the ability of creditors, investors and other financial report users to recognise an organisations financial situation and liquidity, as well as its competency to generate income and cash flow (European Commission, 2011, pp. 1-3). IAS 34 does not provide any directive as to what kinds of organisations are supposed to issue interim financial reports, how frequent issuance should be, or after what period adjacent the completion of an interim phase an issuance should be made. Nevertheless, often all across the world, organisations whose shares are listed on exchanges and traded in markets have been required by governments and other authorities, such as securities regulators and stock exchanges, to issue interim financial reports. The International Accounting Standards Bo ard, and later on the International Accounting Standards Committee, has repeatedly persuaded publicly listed organisations to issue interim financial reports. These interim reports are supposed to be compliant with the codes of recognition, disclosure and measurement, as defined in the IAS 34 (Deloitte, 2006, pp. 4-6). Organisations listed on exchanges are particularly pressured to prepare and issue interim financial reports at the end of the first six months of the financial year, and are typically asked to issue their interim financial reports no more than 60 days after to the completion of the interim phase (European Commission, 2011, pp. 6-8). The annual or interim financial reports of organisations are assessed individually to check their compliance with the IFRSs. If an