Interim Financial Statements

To gather and present all the summary of the company’s accounts into a defined report form are called financial statements.

You can say that those financial statements are a one-page summary of all the accounts of a business.

Financial statements are divided into 4 main reports with another section called notes to the financial statements.

There are two types of financial statements called:

  • Certified/Audited Financial Statements
  • Uncertified/Unaudited Financial Statements

In general, companies make their certified financial statements at the end of every financial year. So that their stakeholder gets information about the company accounts and can take decisions on the basis of this information.

But some companies also declare their financial statements for a period less than their financial year. These statements are called interim financial statements.

Interim financial statements are usually used to convey the performance of the company to its stakeholders. So that the management can have confidence in the market as well as shareholders.

The other feature of interim statements is it does not require to be audited by the company’s auditor. These are issued solely by the management of the company and they are responsible for anything there in the statements.

These statements are widely used when the company wants some publicity about its performance or seeking investment for future growth. Or they see a big boost in the coming period of the company.

They can be prepared after 6 months of the last financial year or can be prepared on a quarterly basis or even on monthly basis also. There is not a single specific defined pattern for these statements.

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It is suggested that interim statements should be prepared and issued before the release of annual financial statements because its preparation takes a lot of time and if you want investment for the company you can lose prime time to attract the eye of interested investors.

It also gives information to the current investor about the business’s current situation so he will not get a surprise at the year-end.

Suggestions of IASB about Interim Financial Statements:

The International Accounting Standard Board makes some suggestions that the interim statements should be prepared on the standards used for annual financial statements.

And it includes the balance sheet at the specific date, income statement for the period you are preparing statements along with cash flow and owners’ equity for the period.

IASB suggests that the company should follow all the guidelines and rules required for the preparation of annual accounts of the company.

So that these statements will provide accurate information for the decision-making.

Interim financial statements Vs Annual Financial Statements

If ever you have worked as an accountant in a public limited company, then you will be aware of requirements needed for the annual financial statements while making interim financial statements you do not need to fulfill any requirements including the following

Inventory Count Physically:

This is a long process and takes a lot of time that why companies prefer to count their inventory once a year during the time of preparing audited financial statements.

They do not take time to verify the figures when preparing interim financial statements.


The annual financial statements require full disclosures of company accounting policies and rules. While the interim financial statements do not have any disclosures to the financial statements.

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Accruals and Year-End Adjusted Entries:

The entries which are accrued at the year-end are recorded and calculated at the year-end. These accruals and adjusting entries are excluded from interim financial statements.