In today’s rapidly changing financial markets, financial- statement users are demanding more information, released more promptly than in the past. To respond to these needs, the IASB issued IAS 34.
At a professional development session, two members engaged in a lively discussion. One member is a controller of an international public company, while the other member is a senior financial analyst in a securities firm.
Financial Analyst: My review of IAS 34 leads me to conclude that the objectives of interim reporting should be the same as those of annual reporting.
Controller: I disagree. Interim reports are aimed at different users, serve different purposes, and must be published more quickly than annual reports. It follows that the underlying objectives should also differ.
Financial Analyst: Regardless of the content of interim reports, the interim operating results should be measured on the same basis as the annual results because the interim period is an integral part of the annual period.
Controller: I agree that there is a measurement problem for interim reporting, but I don’t see that there is a simple solution. For example, I find it difficult to make interim estimates for various expenses given the cyclical nature of our business. After all, the interim period is only a portion of the annual period.

Required
Prepare a memo discussing the main issues raised in the preceding conversation.