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CA Final · Financial Reporting · Ind AS 34 Interim Financial Reporting

Kaveri Engineering Ltd publishes a half-yearly report. Its CFO argues that because only a half-yearly report is issued, the annual results can be measured differently from a firm reporting quarterly. Under Ind AS 34, which view is correct?

Reporting frequency, whether annual, half-yearly or quarterly, must not affect measurement of annual results. To achieve that, interim measurements are made on a year-to-date basis, so Kaveri Engineering cannot measure differently merely because it reports half-yearly.

  1. AHalf-yearly reporters may use shorter-period measurement, since they report less often
  2. BThe frequency of reporting (annual, half-yearly or quarterly) shall not affect the measurement of annual results, so interim measurements are made on a year-to-date basisCorrect
  3. CMeasurements are made for each interim period in isolation, ignoring earlier periods
  4. DAnnual results are re-measured only when the entity moves from half-yearly to quarterly reporting

Explanation

Ind AS 34 states that reporting frequency shall not affect measurement of annual results, and to achieve this, interim measurements are made on a year-to-date basis. The isolated-period view contradicts this requirement.

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