[Illustrative Checklist] Disclosure Requirements under AS 24 | Discontinuing Operations

The objective of AS 24, Discontinuing Operations, is to establish principles for reporting information about discontinuing operations, thereby enhancing the ability of users of financial statements to make projections of an enterprise’s cash flows, earnings-generating capacity, and financial position by segregating information about discontinuing operations from information about continuing operations. This Standard applies to all discontinuing operations of an enterprise. An enterprise should apply the principles of recognition and measurement that are set out in other Accounting Standards for the purpose of deciding when and how to recognise and measure the changes in assets and liabilities and the revenue, expenses, gains, losses and cash flows relating to a discontinuing operation. A checklist can be a useful tool to ensure that all necessary disclosures are made in accordance with the discussed standard. Below is an illustrative checklist that entities may use to comply with AS 24 requirements.

I. Has the enterprise disclosed the fact, reasons, and effect when it abandons or withdraws from a plan that was previously reported as a discontinuing operation

II. Whether the disclosures required under this standard have been presented separately for each discontinuing operation

III. Has the entity restated comparative information for prior periods to segregate assets, liabilities, revenues, expenses and operations in a manner similar to that required above, which is presented in financial statements prepared after the initial disclosure event

IV. Has the enterprise disclosed the following information pertaining to a discontinuing operation in its financial statements, starting from the financial statements of the period in which the initial disclosure event (as defined in paragraph 15 of AS 24) takes place:

a. A description of the discontinuing operation? (disclosed in notes to financial statements)

b. The business or geographical segment(s) in which it is reported as per AS 17, Segment Reporting? (disclosed via Notes to financial statements)

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