Chap013_Class

Chap013_Class - 1 Chapter 13 Segment and Interim Reporting...

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Unformatted text preview: 1 Chapter 13 Segment and Interim Reporting Segment reporting FASB Statement No.131 Determining reportable segments Other disclosure requirements Interim Reporting 2 SFAS 14, Industry Segment Disclosures For each reportable segment, a company was required to disclose: o Revenues. o Operating profit or loss. o Identifiable assets. o Aggregate amount of depreciation, depletion and amortization expense. o Capital expenditures. o Equity in the net income from an investment in the net assets of equity investees. 3 FASB Statement No. 131 The objective of segment reporting is to help financial statement users: Better understand the enterprises performance Better assess prospects for future net cash flows Make more informed judgments about the enterprise as a whole 4 FASB Statement No. 131 Uses the Management Approach to determine segments. Reportable segments must be operating segments of the company. Looks at the internal reporting system for guidance. Segment information must be reported for each operating segment that meets one of three tests. Similar operating segments may be combined. Disclosures about Segments of an Enterprise and Related Information Disclosures about Segments of an Enterprise and Related Information 5 FASB Statement No. 131 An operating segment is a component of an enterprise: That engages in business activities from which it earns revenues and incurs expenses Whose operating results are regularly reviewed by the chief operating decision maker to assess performance and make resource allocation decisions For which discrete financial information is available 6 Operating Segment Tests There are three quantitative tests for identifying a Reportable Industry Segment: Revenue Test Profit or Loss Test Asset Test Only one of the three has to be satisfied for a segment to be reportable....
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Chap013_Class - 1 Chapter 13 Segment and Interim Reporting...

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