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

Orion Pharma Ltd reports quarterly. It argues that, since the frequency of reporting should not affect annual results, it will measure each quarter on a stand-alone basis and add the quarters to get the annual figures, even when this gives a different total from year-to-date measurement. Which view is consistent with Ind AS 34?

Interim measurements must be made on a year-to-date basis. Ind AS 34 requires the same accounting policies as annual statements and says reporting frequency, whether annual, half-yearly or quarterly, must not affect measurement of annual results, so Orion's stand-alone approach is inconsistent.

  1. AStand-alone quarterly measurement is acceptable if disclosed
  2. BMeasurements for interim reporting must be made on a year-to-date basis so that reporting frequency does not affect annual resultsCorrect
  3. CQuarterly measurement may differ from annual policies if the amounts are immaterial
  4. DYear-to-date measurement applies only to half-yearly, not quarterly, reports

Explanation

Ind AS 34 says the frequency of reporting (annual, half-yearly or quarterly) shall not affect measurement of annual results, and to achieve this, interim measurements are made on a year-to-date basis. It also requires the same accounting policies as in annual statements. Stand-alone quarterly measurement conflicts with this.

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