[Illustrative Checklist] on Disclosure Requirement under Ind AS 108 | Operating Segments
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- 2 Min Read
- By Taxmann
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- Last Updated on 15 May, 2023
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The objective of Ind AS 108, Operating Segments, is that an entity shall disclose information to enable users of its financial statements to evaluate the nature and financial effects of the business activities in which it engages and the economic environments in which it operates. This standard provides guidance for entities to identify and report information about their operating segments. An operating segment is a component of a company that engages in business activities that generate revenue and incur expenses, whose operating results are regularly reviewed by the company’s chief operating decision maker (CODM), for which discrete financial information is available. A checklist can be a useful tool to ensure that all necessary disclosures are made in accordance with Ind AS 108. Below is an illustrative checklist that entities may use to comply with Ind AS 108 requirements.
I. Has the entity disclosed information to enable users of financial statements to evaluate the nature and financial effects of the business activities in which the entity engages and the economic environments in which it operates
II. Whether reconciliations of the amounts in the balance sheet for reportable segments to the amounts in the entity’s balance sheet for each date at which a balance sheet presented is disclosed
III. Has the entity disclosed the various factors to determine an entity’s reportable segments, such as the basis of its organization, whether it’s based on product and service differences, geographical locations, regulatory environments, or a combination of such factors
IV. Has the entity’s management disclosed their judgment on the application of aggregation criteria as per para 12 of Ind AS 108, including a brief explanation of the operating segments that have been combined and the economic indicators evaluated to determine that the aggregated operating segments have similar economic characteristics
Click to Read Complete Checklist
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