ACCOUNTING PERIOD AND INTERIM REPORT

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Company measure their financial performance and financial position over a certain period known as the accounting period.

More appropriately, an accounting period may be defined as any time range used to report a company's financial transactions.

It is the period used by an organization when preparing financial statements

The term accounting period also refers to the period, usually, one year, covered by the financial statement.

It is the set length of time in which business transactions must be recorded and translated into financial statements for users to make informed economic decisions.

Types of Accounting period

There are two types of accounting periods, which are: fiscal year and calendar year

1. Calendar year: A calendar year is any accounting period that begins on January 1 and ends on December 31 

2. Fiscal year: A fiscal year is any accounting period that doesn't begin on January 1 and ends on December 31

An accounting period beginning on April 1 and ending on March 31 of the following year is an illustration of a fiscal year.

An accounting period that begins on July 1 and concludes on June 30 is another illustration of a fiscal year.

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Interim reports

Although accounting periods are usually twelve months long, investors and other external users' needs for more frequent communication of accounting information have necessitated the preparation of interim reports.

An Interim report may be defined as the preparation of financial statements for a period lesser than one year.

It can also be defined as a period of financial reporting that is not a fiscal or calendar year.

An interim report may be prepared monthly, quarterly, or semi-annually. 

Companies, especially those that are publicly traded, generally submit interim reports every quarter.

One difference between an interim report and an annual report is that an interim report is not necessarily audited whereas an annual report is usually audited.

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