Segment Reporting-As17: Compiled By: - AKHIL KOHLI (MBA - Marketing) MANJU (MBA - Finance)
Segment Reporting-As17: Compiled By: - AKHIL KOHLI (MBA - Marketing) MANJU (MBA - Finance)
Segment Reporting-As17: Compiled By: - AKHIL KOHLI (MBA - Marketing) MANJU (MBA - Finance)
REPORTING- AS17
To be discussed .
OBJECTIVES
APPLICABILITY
DEFINITIONS
REPORTABLE SEGMENT
SEGMENT REPORTING FORMATS
Objective
To enable the users of financial statements to:
Better understand the performance of the
enterprise;
Better assess the risks and returns of the
enterprise;and
Make more informed judgments about the
enterprise as a whole.
Applicability of standard
Listed Companies
Companies in the process of listing their
Applicability of standard
All
Definitions
Business Segment is a distinguishable
component of an enterprise
that is engaged in providing an individual
product or service or a group of related
products or services and
that is subject to risks and returns that
are different from those of other business
segments.
or services
Methods used to distribute the products or
provide the services
The nature of regulatory environment, for
example, banking, insurance or public
utilities.
conditions;
Relationships between operations in
different geographical areas;
Proximity of operations;
Special risks associated with operations in a
particular area
Exchange control regulations
The underlying currency risks.
Segment Reportingformats
Segment reporting is to be made as
Primary Segment Reporting
Secondary Segment Reporting
Reportable segment
A business or geographical segment is a reportable
segment only if:
Its revenue from sales to external customers
and from transactions with other segments is
10% or more of the total revenue, external and
internal, of all segments; or
Its segment result whether profit or loss is 10%
or more of
The combined result of all segments in
profit; or
The combined result of all segments in
loss,
Whichever is greater in absolute amount;
Reportable segment
its segment assets are 10% or more of the total
assets of all segments.
Segment Revenue
Segment revenue is the aggregate of
(i)
the portion of enterprise revenue
that is directly attributable to a segment.
(ii) the relevant portion of enterprise
revenue that can be allocated on a
reasonable basis to a segment, and
(iii) revenue from transactions with other
segments of the enterprise.
income, including
interest earned on advances or loans to
other segments unless the operations of the
segment are primarily of a financial
nature;and
(c) Gains on sales of investments or on
extinguishment of debt unless the operations
of the segment are primarily of a financial
nature.
Segment Expenses
Segment expense is the aggregate of
(a) the expense resulting from the operating
activities of a segment that is directly
attributable to the segment, and
(b) the relevant portion of enterprise
expense that can be allocated on a
reasonable basis to the segment including
expense relating to transactions with other
segments of the enterprise.
Segment ExpenseExclusions
Extraordinary items
Interest expense including interest incurred on
Segment ExpenseExclusions
Income-tax expense
General administrative expenses, head-office
Segment Assets
Segment assets are those operating assets
Segment Liabilities
Segment
segment expense.
3. Total carrying amount of segment assets;
4. Total amount of segment liabilities;
Reconciliation Statement
A
Secondary Reporting
Format
If the primary format is Business Segment:
Segment Revenue from External Customers
based on Customer location for each
geographical segment
Total carrying amount of segment assets by
geographical location of assets.
Secondary Reporting
Format
The total cost incurred during the year to
Secondary Reporting
Format
If the primary format is geographical segment,
the following information for each business
segment:
Other Requirements:
If primary format is geographical segment
based on location of assets and the location
of its customers is different, Revenue from
external customers for each geographical
segment is also required to be reported.
Other Requirements
Similarly, if the geographical segment is based
on location of customers and the location of
assets is different, the following information
need to be reported:
total