FAR Segment reporting

Question 1

What are the criteria for Segment reporting

Answer 1

Meet at least any of the criteria below (Materiality level 10%)
1. Reported revenue (ie sales to external customer & intersegment sales) >=10% of combined revenue of all operating unit

2. Reported profit/loss >=10% to the greater absolute of:
   a. combined profit of all operating segments that did not report a loss.
   b. combined reported loss of all operating segments that did report a loss.
3. Assets >=10% of the combined assets of all operating segments.

Question 2

In financial reporting segment data, which item is used in determining a segment’s reporting operating income?

Answer 2

Sales to other segments.

Question 3

Under IFRS & US GAAP, what is not reported under an entity’s reportable segments

Answer 3

Segment cash flow.

The following are reported:

• Segment Assets
• Segment Liabilities
• Segment profit or Loss

Question 4

What is the main measurement of operating profit reported

Answer 4

Operating profit by segment is based on the measure of profit reported to the “Chief Operating decision Maker”

Question 5

What is the criterion for the “REPORTING SUFFICIENCY TEST”

Answer 5

The “reporting sufficiency” test requires. that all reportable segments (looking at external sales only) have at least 75% of the total sales of the entire entity.