IAS 14 Segment Reporting.docx

1、IAS 14 Segment ReportingIAS 14 Segment ReportingThis version includes amendments resulting from new and amended IFRSs issued up to 31 December 2004.This Standard is effective for financial statements covering periods beginning on or after 1 July 1998.Paragraphs 129 and 130 of IAS 36 Impairment of As

2、sets set out disclosure requirements for reporting impairment losses by segment.Editorial note: Substituted by IFRS 3 with effect for business combinations for which the agreement date is on or after 31 March 2004, subject to further transitional provisions. Previously Paragraphs 116 and 117 of IAS

3、36, Impairment of Assets, set out certain disclosure requirements for reporting impairment losses by segment.(2005 deleted)International Accounting Standard 14 Segment Reporting (IAS 14) is set out in paragraphs 1-84 and Appendices A-C. All the paragraphs have equal authority but retain the IASC for

4、mat of the Standard when it was adopted by the IASB. IAS 14 should be read in the context of its objective, the Preface to International Financial Reporting Standards and the Framework for the Preparation and Presentation of Financial Statements. These provide a basis for selecting and applying acco

5、unting policies in the absence of explicit guidance.IntroductionIN 1 This Standard (IAS 14 (revised) replaces IAS 14, Reporting Financial Information by Segment (the original IAS 14). IAS 14 (revised) is effective for accounting periods beginning on or after 1 July 1998. The major changes from the o

6、riginal IAS 14 are as follows.IN 2 The original IAS 14 applied to enterprises whose securities are publicly traded and other economically significant entities. IAS 14 (revised) applies to enterprises whose equity or debt securities are publicly traded, including enterprises in the process of issuing

7、 equity or debt securities in a public securities market, but not to other economically significant entities.IN3 The original IAS 14 required that information be reported for industry segments and geographical segments. It provided only general guidance for identifying industry segments and geograph

8、ical segments. It suggested that internal organisational groupings may provide a basis for determining reportable segments, or segment reporting may require reclassification of data. IAS 14 (revised) requires that information be reported for business segments and geographical segments. It provides m

9、ore detailed guidance than the original IAS 14 for identifying business segments and geographical segments. It requires that an enterprise look to its internal organisational structure and internal reporting system for the purpose of identifying those segments. If internal segments are based neither

10、 on groups of related products and services nor on geography, IAS 14 (revised) requires that an enterprise should look to the next lower level of internal segmentation to identify its reportable segments.IN4 The original IAS 14 required that the same quantity of information be reported for both indu

11、stry segments and geographical segments. IAS 14 (revised) provides that one basis of segmentation is primary and the other is secondary, with considerably less information required to be disclosed for secondary segments.IN5 The original IAS 14 was silent on whether segment information must be prepar

12、ed using the accounting policies adopted for the consolidated or enterprise financial statements. IAS 14 (revised) requires that the same accounting policies be followed.IN6 The original IAS 14 had allowed differences in the definition of segment result among enterprises. IAS 14 (revised) provides m

13、ore detailed guidance than the original IAS 14 as to specific items of revenue and expense that should be included in or excluded from segment revenue and segment expense. Accordingly, IAS 14 (revised) provides for a standardised measure of segment result, but only to the extent that items of revenu

14、e and operating expense can be directly attributed or reasonably allocated to segments.IN7 IAS 14 (revised) requires symmetry in the inclusion of items in segment result and in segment assets. If, for example, segment result reflects depreciation expense, the depreciable asset must be included in se

15、gment assets. The original IAS 14 was silent on this matter.IN8 The original IAS 14 was silent on whether segments deemed too small for separate reporting could be combined with other segments or excluded from all reportable segments. IAS 14 (revised) provides that small internally reported segments

16、 that are not required to be separately reported may be combined with each other if they share a substantial number of the factors that define a business segment or geographical segment, or they may be combined with a similar significant segment for which information is reported internally if certai

17、n conditions are met.IN9 The original IAS 14 was silent on whether geographical segments should be based on where the enterprises assets are located (the origin of its sales) or on where its customers are located (the destination of its sales). IAS 14 (revised) requires that, whichever is the basis

18、of an enterprises geographical segments, several items of data must be presented on the other basis if significantly different.IN 10 The original IAS 14 required four principal items of information for both industry segments and geographical segments:(a) sales or other operating revenues, distinguis

19、hing between revenue derived from customers outside the enterprise and revenue derived from other segments;(b) segment result;(c) segment assets employed; and(d) the basis of inter-segment pricing.For an enterprises primary basis of segment reporting (business segments or geographical segments), IAS

20、 14 (revised) requires those same four items of information plus:(a) segment liabilities;(b) cost of property, plant, equipment, and intangible assets acquired during the period;(c) depreciation and amortisation expense;(d) non-cash expenses other than depreciation and amortisation; and(e) the enter

21、prises share of the net profit or loss of an associate, joint venture, or other investment accounted for under the equity method if substantially all of the associates operations are within only that segment, and the amount of the related investment.For an enterprises secondary basis of segment repo

22、rting, IAS 14 (revised) drops the original IAS 14 requirement for segment result and replaces it with the cost of property, plant, equipment, and intangible assets acquired during the period.IN11 The original IAS 14 was silent on whether prior period segment information presented for comparative pur

23、poses should be restated for a material change in segment accounting policies. IAS 14 (revised) requires restatement unless it is impracticable to do so.IN12 IAS 14 (revised) requires that if total revenue from external customers for all reportable segments combined is less than 75 per cent of total

24、 enterprise revenue, then additional reportable segments should be identified until the 75 per cent level is reached.IN13 The original IAS 14 allowed a different method of pricing inter-segment transfers to be used in segment data than was actually used to price the transfers. IAS 14 (revised) requi

25、res that inter-segment transfers be measured on the basis that the enterprise actually used to price the transfers.IN14 IAS 14 (revised) requires disclosure of revenue for any segment not deemed reportable because it earns a majority of its revenue from sales to other segments if that segments reven

26、ue from sales to external customers is 10 per cent or more of total enterprise revenue. The original IAS 14 had no comparable requirement.ObjectiveThe objective of this Standard is to establish principles for reporting financial information by segment - information about the different types of produ

27、cts and services an enterprise produces and the different geographical areas in which it operates - to help users of financial statements:(a) better understand the enterprises past performance;(b) better assess the enterprises risks and returns; and(c) make more informed judgements about the enterpr

28、ise as a whole.Many enterprises provide groups of products and services or operate in geographical areas that are subject to differing rates of profitability, opportunities for growth, future prospects, and risks. Information about an enterprises different types of products and services and its oper

29、ations in different geographical areas - often called segment information - is relevant to assessing the risks and returns of a diversified or multinational enterprise but may not be determinable from the aggregated data. Therefore, segment information is widely regarded as necessary to meeting the

30、needs of users of financial statements.Scope1. This Standard should be applied in complete sets of published financial statements that comply with International Accounting Standards.2. A complete set of financial statements includes a balance sheet, income statement, cash flow statement, a statement

31、 showing changes in equity, and notes, as provided in IAS 1, Presentation of Financial Statements.3. This Standard should be applied by enterprises whose equity or debt securities are publicly traded and by enterprises that are in the process of issuing equity or debt securities in public securities

32、 markets.4. If an enterprise whose securities are not publicly traded prepares financial statements that comply with International Accounting Standards, that enterprise is encouraged to disclose financial information by segment voluntarily.5. If an enterprise whose securities are not publicly traded chooses to disclose segment information voluntarily in financial statements that comply with International Accounting Standards, that enterprise should comply fully with the requirements of this Standard.6. If a single financial report contains both consolidated fina