Interim Statement
An interim statement (or interim report) is a financial report issued by a company between its full-year (annual) financial statements. Interim statements provide timely information about a company’s financial position, performance, cash flows, and changes in equity for a portion of the fiscal year (typically a quarter), and are generally unaudited.
Purpose and benefits
- Keeps shareholders, analysts, and the market informed between annual reports.
- Alerts the public to material changes or events that could affect valuation or operations.
- Helps investors allocate capital and supports market liquidity by reducing information gaps.
- Enables management to communicate progress against targets and respond to market developments.
Preparation and standards
- The International Accounting Standards Board (IASB) recommends presenting condensed versions of financial statements covering:
- Financial position (balance sheet)
- Income statement
- Cash flows
- Changes in equity
- Explanatory notes
- Companies should apply the same accounting policies in interim statements as in their audited annual reports, to ensure consistency and comparability.
- Interim statements are typically less detailed than annual reports and are not usually audited.
Common example: Quarterly reports
- Quarterly reports are the most common interim statements and summarize unaudited financial statements for a three-month period. They may include:
- Quarter-to-quarter results
- Year-to-date figures
- Comparative information (e.g., this quarter vs. same quarter last year)
- In the U.S., publicly traded companies file quarterly reports on Form 10-Q with the Securities and Exchange Commission (SEC). The annual audited report is filed on Form 10-K and contains more comprehensive disclosures.
- Typical fiscal quarters (for calendar-year companies) end on March 31, June 30, September 30, and December 31. Quarterly reports are usually filed within a few weeks after quarter-end.
Other interim disclosures
- Form 8-K: Used to report unscheduled material events or corporate changes (e.g., acquisitions, bankruptcies, director resignations, fiscal year changes). It gives timely notice of significant events that may affect shareholders.
- Form 13F: Investment managers overseeing more than $100 million in certain assets must file quarterly holdings reports (Form 13F) with the SEC.
Limitations
- Interim statements are generally unaudited and may be less detailed than annual reports.
- Short-term fluctuations in results can be misleading if viewed without context or year-to-date comparisons.
Key takeaways
- Interim statements provide timely, periodic financial information between annual reports.
- They promote transparency and help investors and markets react more quickly to material developments.
- Quarterly reports (10-Q) are the most common form of interim reporting; other disclosures (8-K, 13F) cover specific events or holdings.
- Consistent accounting policies and clear explanatory notes improve the usefulness of interim statements.