Auditor Review Of Interim Financial Statements: Fill & Download for Free

For the purpose of understanding Limited Review first let us understand that under what circumstances limited review is done. Limited review is done when interim financial information is prepared and presented in accordance with an applicable financial reporting framework and comprises either a complete or a condensed set of financial statements for a period that is shorter than the entity’s financial year.So accordingly most of the times, limited review is done when companies listed on Stock Exchange are required to file quarterly financial statements. There are also some other circumstances like the subsidiary company of a foreign holding company has to finalise it’s books of accounts for the closing of the Foreign Holding company which has a different financial year.For the purpose of limited review engagements the Independent Auditor has to follow Standard on Review Engagements - SRE 2410 i.e. Review of the Interim Financial Information Performed by the independent auditor of the entity.The objective limited review engagement is to enable the auditor to express a conclusion whether, on the basis of the review, anything has come to the auditor’s attention that causes the auditor to believe that the interim financial information is not prepared, in all material respects, in accordance with an applicable financial reporting framework.A limited review does not provide a basis for expressing an opinion whether the financial information gives a true and fair view, or is presented fairly, in all material respects, in accordance with an applicable financial reporting framework.A review, in contrast to an audit, is not designed to obtain reasonable assurance that the interim financial information is free from material misstatement.A review may bring significant matters affecting the interim financial information to the auditor’s attention, but it does not provide all of the evidence that would be required in an audit.

Interim financial statements cover a period of less than one year. The concept is most commonly applied to publicly held companies, which must issue these statements at quarterly intervals. These entities issue three sets of interim statements per year, which are for the first, second, and third quarters. The final reporting period of the year is encompassed by the year-end financial statements, and so is not considered to be associated with interim financial statements.The interim statement concept can apply to any period, such as the last five months. Technically, the "interim" concept does not apply to the balance sheet , since this financial statement only refers to assets, liabilities, and equity as of a specific point in time, rather than over a period of time.Interim financial statements contain the same documents as will be found in annual financial statements - that is, the income statement, balance sheet, and statement of cash flows The line items appearing in these documents will also match the ones found in annual financial statements. The main differences between interim and annual statements can be found in the following areas:Disclosures. Some accompanying disclosures are not required in interim financial statements, or can be presented in a more summarized format.Accrual basis. The basis upon which accrued expenses are made can vary within interim reporting periods. For example, an expense could be recorded entirely within one reporting period, or its recognition may be spread across multiple periods. These issues can make the results and financial positions contained within interim periods appear to be somewhat inconsistent, when reviewed on a comparative basis.Seasonality. The revenues generated by a business may be significantly impacted by seasonality. If so, interim statements may reveal periods of major losses and profits, which are not apparent in the annual financial statements.Interim financial statements are not usually audited. Given the cost and time required for an audit for only the year-end financial statements are audited. If a company is publicly-held, its quarterly financial statements are instead reviewed. A review is conducted by outside auditors, but the activities encompassed by a review are much reduced from those employed in an audit.

According to the Technical Guide to Listing”, page 48:“Once your company is listed on TSX or TSXV, it will be a reporting issuer with ongoing reporting and disclosure obligations. These obligations arise under both securities law and the requirements of the Exchanges. Accordingly, the obligations will result in filing required information with the securities commissions, the Exchanges, or both. The documents that reporting issuers must file as part of their continuous and timely disclosure responsibilities include:DOCUMENTS REQUIREDAnnual and interim financial statements: Annual financial statements must be audited. While there is no requirement for the reporting issuer’s auditor to review interim financial statements, if the auditor did not review them, this fact must be disclosed.I do see that there are varying listing requirements depending on industry category. See Listing Guides with sections forMining CompaniesOil & Gas CompaniesIndustrial, Technology and Research & Development Companies