Segment Reporting

Question 1

what are the qualifications of a reportable segment?

Answer 1

the qualifications are a segment musts meet the minimum 10% of one of revenue, P&L, or assets and report to the chief operating officer.

Question 2

What are the common examples of a summary significant accounting policies?

Answer 2

Includes: measurement bases, accounting principles and methods, criteria, and policies such as basis of consolidation, depreciation methods, revenue recognition,..

Question 3

what is percentage and how to determine threshold amount to determine reporting segment?

Answer 3

• 10% of threshold
• if there reporting segment is purely based on 1 component such as operating results including profit and loss, we determine threshold by taking 10% of sum of all profit or all loss, whichever is greater. Then, compare the threshold amount to each segment’s profit or loss.
• For example, a company has 4 segments: 2 is profitable and 2 is in loss. We will sum 2 profits and sum 2 losses. Then, take 10% of which sum is greater is the threshold