Segmentation – Information about major customers

Similar to the information about geographic areas, disclosures of major customers are designed to assist financial statement users in assessing where there may be a significant concentration of risk.

IFRS 8 establishes a 10 percent threshold of total annual revenue for identifying and disclosing major customers. As a result the entity shall disclose that fact, the total amount of revenues from each such customer, and the identity of the segment or segments reporting the revenues. The entity need not … Continue reading

Can a R&D function be an operating segment?

As long as discrete information is reviewed by the CODM. Typically, an entity’s research and development (R&D) function is a vertically integrated operation (see Operating segments – Vertically integrated operation), in which the R&D activities serve as an integral component of the entity’s business. The definition of operating segment envisages that part of an entity that earns revenue and incurs expenses relating to transactions with other components of the same entity may still qualify as an operating segment even … Continue reading