WEEK 4: Segment Reporting
Every operating segment of an entity is also a reportable segment. True or False?
False
IFRS8 requires an entity to disclose the identity of its major customers. True or False?
False
In general, a major customer is one that accounts for at least 5% of an entity's external revenues. True or False?
False
An entity must provide a reconciliation between the total revenue of reportable segments and the entity's total revenue. True or False?
True
The classes of "entity-wide" disclosures required by IFRS8 do not include information about: a) The entity's management structure b) The entity's products and services c) The geographical areas in which the entity operates d) The entity's major customers
a) The entity's management structure
IFRS8 requires that entities should disclose certain information about reportable segments (if regularly provided to the chief operating decision maker). This information does not include: a) Segment revenue b) Segment cost of sales c) Segment depreciation d) Segment interest expense
b) Segment cost of sales
A reportable segment is an operating segment which meets any of several 10% thresholds. Which of the following is not one of these thresholds? a) Segment assets are at least 10% of the total assets of all operating segments b) Segment liabilities are at least 10% of the total liabilities of all operating segments c) Segment revenue is at least 10% of the total revenue of all operating segments d) Segment profit or loss is at least 10% of the greater of the total profit of all profitable operating segments and the total loss of all loss-making operating segments
b) Segment liabilities are at least 10% of the total liabilities of all operating segments
IFRS8 specifically identifies certain similarities which must exist between operating segments in order for them to be combined into one segment for financial reporting purposes. These similarities do not include: a) Similar products and services b) Similar types of customer c) Similar types of supplier d) A similar regulatory environment
c) Similar types of supplier
Which of the following is a characteristic of an operating segment, as defined by international standard IFRS8? a) It engages in business activities from which it may earn revenues and incur expenses b) Its operating results are regularly reviewed by the chief operating decision maker c) Discrete financial information is available d) All of the above
d) All of the above
A company's total external revenue for an accounting period is £15m. There is no inter-segment revenue. The company's total assets are £43m. The total profit or all profitable segments for the period is £2.6m and the total losses of all loss-making segments are £1.9m. Operating segment X has external revenue of £1.3m, total assets of £3.7m and a loss of £220,000. Which of the following statements is true? a) Segment X is a reportable segment because it has revenue of £1.3m b) Segment X is a reportable segment because it has assets of £3.7m c) Segment X is a reportable segment because it has a loss of £220,000 d) Segment X is not a reportable segment
d) Segment X is not a reportable segment
