Question 1

AASB 8 requires that:

Accepted Answer

A)  Reportable segments must individually constitute less than 75 per cent of the entity's total revenues. 
B)  The total revenues attributable to the reportable segments must be equal to or greater than 75 per cent of the entity's total revenues. 
C)  The total external revenues attributable to reportable segments must equal at least 75 per cent of the entity's total revenues. 
D)  The sum of the individual reportable segment's profits or losses must be equal to or greater than 75 per cent of the entity's absolute amount of profit or loss. 
A)  Reportable segments must individually constitute less than 75 per cent of the entity's total revenues. 
B)  The total revenues attributable to the reportable segments must be equal to or greater than 75 per cent of the entity's total revenues. 
C)  The total external revenues attributable to reportable segments must equal at least 75 per cent of the entity's total revenues. 
D)  The sum of the individual reportable segment's profits or losses must be equal to or greater than 75 per cent of the entity's absolute amount of profit or loss.

Question 2

A geographical segment is defined in part by AASB 8 as being a distinguishable component of an entity engaged in providing products and services within a particular social and cultural environment.

Accepted Answer

A) True 
 B)False

Question 3

Discuss the issues involved in allowing management to determine the basis of measurement for operating segments.

Accepted Answer

Allowing management to determine the bas

Question 4

In accordance with AASB 8 an operating segment is a component of an entity:

Accepted Answer

A)  that engages in business activities from which it may earn revenues and incur expenses. 
B)  whose operating results are regularly reviewed by the entity's chief operating decision maker to make decisions about resources to be allocated to the segment and asses its performance. 
C)  for which discrete financial information is available. 
D)  All of the given answers are correct. 
A)  that engages in business activities from which it may earn revenues and incur expenses. 
B)  whose operating results are regularly reviewed by the entity's chief operating decision maker to make decisions about resources to be allocated to the segment and asses its performance. 
C)  for which discrete financial information is available. 
D)  All of the given answers are correct.

Question 5

Managers may choose to provide segment data voluntarily because:

Accepted Answer

A)  They want to highlight the companies in the group that are doing well. 
B)  Managers generally do not believe that consolidated accounts are meaningful. 
C)  The segment information will demonstrate more accurately where they have done well and where they have done badly. 
D)  It demonstrates a greater level of accountability that may attract investment funds. 
A)  They want to highlight the companies in the group that are doing well. 
B)  Managers generally do not believe that consolidated accounts are meaningful. 
C)  The segment information will demonstrate more accurately where they have done well and where they have done badly. 
D)  It demonstrates a greater level of accountability that may attract investment funds.

Question 6

AASB 8 requires which of the following information to be disclosed about major customers?

Accepted Answer

A)  customer identity 
B)  revenues when greater that 10 per cent of an entity's revenue 
C)  amount of revenues for each segment 
D)  revenue history 
A)  customer identity 
B)  revenues when greater that 10 per cent of an entity's revenue 
C)  amount of revenues for each segment 
D)  revenue history

Question 7

According to AASB 8,'where total external revenues attributable to reportable segments constitute less than 75 per cent of the entity's total revenues':

Accepted Answer

A)  additional reportable segments must be identified in accordance with the definition of reportable segments, until at least 75 per cent of the entity's total revenues are included in reportable segments. 
B)  the entity reports those segments already identified as reportable, even though they constitute less than 75 per cent of the entity's total revenues. 
C)  additional segments must be identified as reportable segments, even if they do not qualify as reportable segments, until at least 75 per cent of the entity's total revenues are included in reportable segments. 
D)  the entity considers whether total external revenues attributable to reportable segments constitute greater than 75 per cent of the entity's total external revenues, and if so, report those segments already identified. 
A)  additional reportable segments must be identified in accordance with the definition of reportable segments, until at least 75 per cent of the entity's total revenues are included in reportable segments. 
B)  the entity reports those segments already identified as reportable, even though they constitute less than 75 per cent of the entity's total revenues. 
C)  additional segments must be identified as reportable segments, even if they do not qualify as reportable segments, until at least 75 per cent of the entity's total revenues are included in reportable segments. 
D)  the entity considers whether total external revenues attributable to reportable segments constitute greater than 75 per cent of the entity's total external revenues, and if so, report those segments already identified.

Question 8

The following information relates to All Industrials Ltd and its operating segment (in $'000s): $$\begin{array} { | l | r | r | r | r | r | r | } 
\hline &  { \text { Retail } } & { \text { Agriculture } } & { \text { Brewing } } & \text { Chemicals } & \text { Transport } & \text { Total } \\
\hline \text { Segment revenues } & & & & & & \
\hline \text { External } & 1100 & 1500 & 320 & 215 & 100 & 3235 \
\hline \text { Other segments } & 150 & 200 & 28 & 41 & 40 & 459 \
\hline \text { Segment results } & 220 & 127 & ( 30 ) & ( 360 ) & ( 20 ) & ( 63 ) \
\hline \text { Segment assets } & 360 & 260 & 50 & 50 & 51 & 771 \
\hline
\end{array}$$ Which operating segments are considered to be reportable under AASB 8 using the segment asset qualitative threshold?

Accepted Answer

A)  all segments 
B)  retail and agriculture 
C)  retail, agriculture and brewing 
D)  retail, agriculture and chemicals 
A)  all segments 
B)  retail and agriculture 
C)  retail, agriculture and brewing 
D)  retail, agriculture and chemicals

Question 9

Segment revenues do not include:

Accepted Answer

A)  interest earned on loans to other segments. 
B)  interest or dividend income, unless the segment's operations are primarily of a financial nature. 
C)  joint venturer's revenues from its share of joint venture operations. 
D)  interest earned on loans to other segments and interest or dividend income, unless the segment's operations are primarily of a financial nature. 
A)  interest earned on loans to other segments. 
B)  interest or dividend income, unless the segment's operations are primarily of a financial nature. 
C)  joint venturer's revenues from its share of joint venture operations. 
D)  interest earned on loans to other segments and interest or dividend income, unless the segment's operations are primarily of a financial nature.

Question 10

Segment expenses do not include:

Accepted Answer

A)  joint venturer's expenses relating to the operation of joint venture operations. 
B)  losses on sales of investments or extinguishment of debt unless the segment's operations are primarily financial in nature. 
C)  income tax expense. 
D)  losses on sales of investments or extinguishment of debt unless the segment's operations are primarily financial in nature and before income tax expense. 
A)  joint venturer's expenses relating to the operation of joint venture operations. 
B)  losses on sales of investments or extinguishment of debt unless the segment's operations are primarily financial in nature. 
C)  income tax expense. 
D)  losses on sales of investments or extinguishment of debt unless the segment's operations are primarily financial in nature and before income tax expense.

Question 11

AASB 8 specifies that a geographical segment cannot include more than two countries:

Accepted Answer

A) True 
 B)False

Question 12

AASB 8 is more:

Accepted Answer

A)  rules based. 
B)  cost based. 
C)  principles based. 
D)  profit based. 
A)  rules based. 
B)  cost based. 
C)  principles based. 
D)  profit based.

Question 13

The following information relates to All Industrials Ltd and its operating segment (in $'000s): $$\begin{array} { | l | r | r | r | r | r | r | } 
\hline &  { \text { Retail } } & { \text { Agriculture } } & { \text { Brewing } } & \text { Chemicals } & \text { Transport } & \text { Total } \\
\hline \text { Segment revenues } & & & & & & \
\hline \text { External } & 1100 & 1500 & 320 & 215 & 100 & 3235 \
\hline \text { Other segments } & 150 & 200 & 28 & 41 & 40 & 459 \
\hline \text { Segment results } & 220 & 127 & ( 30 ) & ( 360 ) & ( 20 ) & ( 63 ) \
\hline \text { Segment assets } & 360 & 260 & 50 & 50 & 51 & 771 \
\hline
\end{array}$$ Which operating segments are considered to be reportable under AASB 8 using the segment revenue qualitative threshold?

Accepted Answer

A)  all segments 
B)  retail and agriculture 
C)  retail, agriculture and brewing 
D)  retail, agriculture and chemicals 
A)  all segments 
B)  retail and agriculture 
C)  retail, agriculture and brewing 
D)  retail, agriculture and chemicals

Question 14

Identification of operating segments in AASB 8 Operating Segments adopts a 'rules-based' approach,while its predecessor AASB 114 Segment Reporting adopts a 'principles-based' approach.

Accepted Answer

A) True 
 B)False

Question 15

AASB 8 requires reconciliation of reported segments' amounts to the entity's reported amount for which of the following items?

Accepted Answer

A)  dividend income 
B)  expenses 
C)  depreciation 
D)  liabilities 
A)  dividend income 
B)  expenses 
C)  depreciation 
D)  liabilities

Question 16

Discuss the concerns raised about competitive disadvantage to the reporting entity in providing disclosures on operating segments.

Accepted Answer

Some organisations opposed detailed segm

Question 17

AASB 8 Operating Segments requires an entity to report a measure of segment liabilities and particular income and expense items,if such measures are regularly provided to the chief operating officer.

Accepted Answer

A) True 
 B)False

Question 18

AASB 8 identifies five factors that are to be considered in determining whether or not products and services are related for the purposes of defining a business segment.It further specifies that the products and services included in a business segment must be similar with respect to all these factors.

Accepted Answer

A) True 
 B)False

Question 19

Two or more operating segments may be aggregated into a single operating segment if aggregation is consistent with the core principle of AASB 8,or the segments have similar economic characteristics,or the segments are similar in the nature of the products and services.

Accepted Answer

A) True 
 B)False

Question 20

According to AASB 8,factors to be considered in aggregating operating segments include:

Accepted Answer

A)  a similar production process. 
B)  exchange control regulations. 
C)  a common communications network. 
D)  a similar regulatory environment. 
A)  a similar production process. 
B)  exchange control regulations. 
C)  a common communications network. 
D)  a similar regulatory environment.

Exam 24: Segment Reporting

AASB 8 requires that:

A geographical segment is defined in part by AASB 8 as being a distinguishable component of an entity engaged in providing products and services within a particular social and cultural environment.

Discuss the issues involved in allowing management to determine the basis of measurement for operating segments.

In accordance with AASB 8 an operating segment is a component of an entity:

Managers may choose to provide segment data voluntarily because:

AASB 8 requires which of the following information to be disclosed about major customers?

According to AASB 8,'where total external revenues attributable to reportable segments constitute less than 75 per cent of the entity's total revenues':

Segment revenues do not include:

Segment expenses do not include:

AASB 8 specifies that a geographical segment cannot include more than two countries:

AASB 8 is more:

Identification of operating segments in AASB 8 Operating Segments adopts a 'rules-based' approach,while its predecessor AASB 114 Segment Reporting adopts a 'principles-based' approach.

AASB 8 requires reconciliation of reported segments' amounts to the entity's reported amount for which of the following items?

Discuss the concerns raised about competitive disadvantage to the reporting entity in providing disclosures on operating segments.

AASB 8 Operating Segments requires an entity to report a measure of segment liabilities and particular income and expense items,if such measures are regularly provided to the chief operating officer.

Two or more operating segments may be aggregated into a single operating segment if aggregation is consistent with the core principle of AASB 8,or the segments have similar economic characteristics,or the segments are similar in the nature of the products and services.

According to AASB 8,factors to be considered in aggregating operating segments include:

An Overview of the Australian External Reporting Environment

The Conceptual Framework of Accounting and Its Relevance to Financial Reporting

Theories of Accounting

An Overview of Accounting for Assets

Depreciation of Property, plant and Equipment

Revaluations and Impairment Testing of Non-Current Assets

Inventory

Accounting for Intangibles

Accounting for Heritage Assets and Biological Assets

An Overview of Accounting for Liabilities

Accounting for Leases

Accounting for Employee Benefits

Share Capital and Reserves

Accounting for Financial Instruments

Revenue Recognition Issues

The Statement of Comprehensive Income and Statement of Changes in Equity

Accounting for Share-Based Payments

Accounting for Income Taxes

The Statement of Cash Flows

Accounting for the Extractive Industries

Accounting for General Insurance Contracts

Accounting for Superannuation Plans

Events Occurring After the End of the Reporting Period

Related Party Disclosures

Earnings Per Share

Accounting for Group Structures

Further Consolidation Issues I: Accounting for Intragroup Transactions

Further Consolidation Issues II: Accounting for Non-Controlling Interests

Further Consolidation Issues IV: Accounting for Changes in the Degree of Ownership of a Subsidiary

Accounting for Equity Investments,including Investments in Associates and Joint Arrangements

Accounting for Foreign Currency Transactions

Translating the Financial Statements of Foreign Operations

Accounting for Corporate Social Responsibility

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