Entity-wide disclosures
As well as financial disclosures, IFRS 8 requires other entity-wide, non-financial information disclosures, such as information about:
As well as financial disclosures, IFRS 8 requires other entity-wide, non-financial information disclosures, such as information about:
Companies are often involved in a number of different industries or business activities. They often expand and diversify their operations across geographical areas.
As a result of this, their group is exposed to different rates of return, growth opportunities and risk for each ‘segment’ of their business.
Investors want information that highlights the performance of the various components of the organization.
This is where IFRS 8 Operating Segments steps in.
One of the first things an entity must do under IFRS 8 is to identify an operating segment.
Under IFRS 8 an operating segment is a component of an entity:
IFRS 8 states that an entity shall disclose information so that users of the financial statements can evaluate the nature and financial effects of the business activities in which it engages and the economic environments in which it operates.
Segment reporting provides financial information about the individual units of the company. It’s intended to give information to users of the financial statements regarding the financial performance and position of the most important operating units of a company.