Determine the meaning of reportable segments, Financial Management

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Determine the meaning of Reportable segments

Reportable  segments  are  operating  segments  or  aggregations  of  operating  segments  which meet specified criteria(core principle):

  • Segments revenue (external andinternal) is 10% or more than the combined external and internal revenue of all operating segments or
  • Segments profit is 10% or more than the combined operating segments profit. Segments loss is 10% or more than the combined operating segments losses or
  • Segments assets are 10% or more than the combined assets of all operating segments.

If total external revenue reported by operating segments is less than 75% of the organisation's entire revenue, additional operating segments should be identified as reportable segments (even if they don't meet the 10% criteria above) until at least 75% of the organisation's revenue is included in reportable segments. IFRS 8 requires an entity to report financial and descriptive information about its reportable segments.

 


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