Identifying reportable segments

Primary Reporting Format
39. The disclosure requirements in paragraphs 40-46 should be applied
to each reportable segment based on primary reporting format of an
enterprise.
40. An enterprise should disclose the following for each reportable
segment:
(a) segment revenue, classified into segment revenue from sales to
external customers and segment revenue from transactions with
other segments;
(b) segment result;
(c) total carrying amount of segment assets;
(d) total amount of segment liabilities;
(e) total cost incurred during the period to acquire segment assets
that are expected to be used during more than one period (tangible
and intangible fixed assets);
(f) total amount of expense included in the segment result for
depreciation and amortisation in respect of segment assets for
the period; and
(g) total amount of significant non-cash expenses, other than
depreciation and amortisation in respect of segment assets, that
were included in segment expense and, therefore, deducted in
measuring segment result.
41. Paragraph 40 (b) requires an enterprise to report segment result. If an
enterprise can compute segment net profit or loss or some other measure of
segment profitability other than segment result, without arbitrary allocations,
reporting of such amount(s) in addition to segment result is encouraged. If
that measure is prepared on a basis other than the accounting policies adopted
for the financial statements of the enterprise, the enterprise will include in its
financial statements a clear description of the basis of measurement.

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AS 17
42. An example of a measure of segment performance above segment
result in the statement of profit and loss is gross margin on sales. Examples
of measures of segment performance below segment result in the statement
of profit and loss are profit or loss from ordinary activities (either before or
after income taxes) and net profit or loss.
43. Accounting 
Standard 5, ‘Net Profit or Loss for the Period, Prior Period
Items and Changes in Accounting Policies’ requires that “when items of
income and expense within profit or loss from ordinary activities are of
such size, nature or incidence that their disclosure is relevant to explain the
performance of the enterprise for the period, the nature and amount of such
items should be disclosed separately”. Examples of such items include write-
downs of inventories, provisions for restructuring, disposals of fixed assets
and long-term investments, legislative changes having retrospective
application, litigation settlements, and reversal of provisions. An enterprise
is encouraged, but not required, to disclose the nature and amount of any
items of segment revenue and segment expense that are of such size, nature,
or incidence that their disclosure is relevant to explain the performance of
the segment for the period. Such disclosure is not intended to change the
classification of any such items of revenue or expense from ordinary to
extraordinary or to change the measurement of such items. The disclosure,
however, does change the level at which the significance of such items is
evaluated for disclosure purposes from the enterprise level to the segment
level.