Some Accountants Hold the View That Each Interim Period Should

question 28

Essay

Some accountants hold the view that each interim period should stand alone as a basic ac-counting period, whereas others view each interim period as essentially an integral part of the annual period.Distinguish between these views.

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Definitions:

Financial Intermediation

The process by which financial institutions act as intermediaries between lenders and borrowers.

Institutional Investor

A business organization that buys and sells securities. Generally, a fund of some kind such as a mutual fund or a pension fund that invests the pooled money of its clients.

Pension Funds

Investment pools that collect and invest funds contributed by sponsors and beneficiaries to provide future pension benefits.

Insurance Companies

Businesses that provide protection against financial losses in exchange for regular payments from individuals or entities.