The Roadmap to Effective Segment Reporting, At the Core of Value Discovery
Journal
IRZ: Zeitschrift für internationale Rechnungslegung
ISSN
1862-5533
Type
journal article
Date Issued
2017-04-01
Author(s)
Abstract
Current segment reporting does not assist investors in their use of valuation models. Investors would like more segment-level information. These are key findings of the Post-Implementation
Review (PIR) of IFRS 8 (2013) and PIR SFAS 131 (2012). They highlight that the development and improvement of segment reporting is long overdue. Although it is as a critical cornerstone for forecasting future firm performance and firm value, the current status quo of segment reporting does not enable investors to perform segment analysis with a focus on operating activities,profitability, and growth. In order to address key concerns of the PIR on segment reporting,the IASB proposes the disclosure of additional line items to the segment statements (IFRS 8 Staff Paper, October 2016). We appreciate the IASB’s initiative to improve segment reporting.At the same time, we would like to emphasize that segment reporting from the investors’perspective can only be improved if it aims to identify value drivers, thus sharpening the focuson operations.
Review (PIR) of IFRS 8 (2013) and PIR SFAS 131 (2012). They highlight that the development and improvement of segment reporting is long overdue. Although it is as a critical cornerstone for forecasting future firm performance and firm value, the current status quo of segment reporting does not enable investors to perform segment analysis with a focus on operating activities,profitability, and growth. In order to address key concerns of the PIR on segment reporting,the IASB proposes the disclosure of additional line items to the segment statements (IFRS 8 Staff Paper, October 2016). We appreciate the IASB’s initiative to improve segment reporting.At the same time, we would like to emphasize that segment reporting from the investors’perspective can only be improved if it aims to identify value drivers, thus sharpening the focuson operations.
Language
English
Keywords
IFRS 8; SFAS 131; Post-Implementation Review (PIR); IASB Proposals
Management Approach; Segment
Key Value driver
External Reporting; Internal Use
HSG Classification
contribution to scientific community
HSG Profile Area
None
Refereed
Yes
Publisher
Beck
Publisher place
München
Number
4
Start page
177
End page
183
Pages
7
Subject(s)
Eprints ID
250537