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AS 17  BY  DR.PRANAV SARASWAT
<ul><li>Short questions: </li></ul><ul><li>1. List down the enterprises for </li></ul><ul><li>which AS 17 are mandatory? <...
2 . What is the objective of AS 17? a. Objective of this statement is to establish the principles for reporting financial ...
3 . What are the advantages of segment information? a. Segment information helps users of financial statements: - Better u...
4. How the segment information need to be presented? If a single financial report contains both consolidated financial sta...
5. Define business segment? A business segment is a distinguishable component of an enterprise: - That is engaged in provi...
6 . Define geographical segment? A distinguishable component of a enterprise: - That is engaged in providing products or s...
7. Define reportable segment? - Reportable segment is a business segment or a geographical segment - Identified on the bas...
What are the factors that should be considered in determining whether products or services are related?   <ul><li>- The me...
<ul><li>What are the factors that should be </li></ul><ul><li>considered in identifying geographical </li></ul><ul><li>seg...
<ul><li>11. Define segment revenue? </li></ul><ul><li>- Segment revenue is the aggregate of: </li></ul><ul><li>- The porti...
What are the items excluded from segment revenue? a. Extra ordinary items as defined in AS 5, Net profit or loss for the p...
<ul><li>Define segment expense? </li></ul><ul><li>Segment expense is the aggregate of: </li></ul><ul><li>- The expense res...
What are the items excluded from segment expenses? a. Extra ordinary items as defined in AS 5, Net profit or loss for the ...
Define segment assets? Segment assets are those operating assets that are employed by a segment in its operating activitie...
What are the factors that influence the risks and returns of an enterprise? - Geographical location of its operations and ...
What are the disclosure requirements for primary reporting format? - An enterprise should disclose the following for each ...
 
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Transcript of "As 17"

  1. 1. AS 17 BY DR.PRANAV SARASWAT
  2. 2. <ul><li>Short questions: </li></ul><ul><li>1. List down the enterprises for </li></ul><ul><li>which AS 17 are mandatory? </li></ul><ul><li>a. Listing criteria: Enterprises whose equity or debt </li></ul><ul><li>securities are listed on a recognized stock </li></ul><ul><li>exchange and enterprises that are in the process of </li></ul><ul><li>issuing equity or debt securities that will be listed </li></ul><ul><li>on a recognized stock exchange in India as </li></ul><ul><li>evidenced by the BOD’s resolution in this regard. </li></ul><ul><li>b. Turnover criteria: All other commercial industrial </li></ul><ul><li>and business reporting enterprises, whose turnover </li></ul><ul><li>for the accounting period exceeds Rs. 50 crores. </li></ul>
  3. 3. 2 . What is the objective of AS 17? a. Objective of this statement is to establish the principles for reporting financial information about the different types of products and services an enterprises produces and different geographical areas in which it operates
  4. 4. 3 . What are the advantages of segment information? a. Segment information helps users of financial statements: - Better understand the performance of the enterprise - Better access the risks and returns of the enterprise - Make more informed judgments about the enterprise as a whole
  5. 5. 4. How the segment information need to be presented? If a single financial report contains both consolidated financial statements and the separate financial statements of the parent, segment information need be presented only on the basis of the consolidated financial statements
  6. 6. 5. Define business segment? A business segment is a distinguishable component of an enterprise: - That is engaged in providing an individual product or service or a group of related products or services, and - That is subject to risks and returns that are different from those of other business segments .
  7. 7. 6 . Define geographical segment? A distinguishable component of a enterprise: - That is engaged in providing products or services within a particular economic environment and, - That is subject to risks and returns that are different from those of components operating in other economic environments
  8. 8. 7. Define reportable segment? - Reportable segment is a business segment or a geographical segment - Identified on the basis of foregoing Definitions - For which segment information is required to be disclosed by this statement.
  9. 9. What are the factors that should be considered in determining whether products or services are related? <ul><li>- The method used to distribute the products or provide the services; and </li></ul><ul><li>- The type or class of customers for the products or services </li></ul><ul><li>- The nature of the production processes </li></ul><ul><li>-If applicable, the nature of the regulatory environment eg. Banking, insurance or public utilities </li></ul>
  10. 10. <ul><li>What are the factors that should be </li></ul><ul><li>considered in identifying geographical </li></ul><ul><li>segments? </li></ul><ul><li>- Similarity of economic, political </li></ul><ul><li>Conditions </li></ul><ul><li>- The relationship between operations </li></ul><ul><li>in different geographical areas </li></ul><ul><li>Proximity of operations </li></ul><ul><li>- Special risks associated with </li></ul><ul><li>operations in a particular area </li></ul><ul><li>Exchange control regulations </li></ul><ul><li>- The underlying currency risks </li></ul>
  11. 11. <ul><li>11. Define segment revenue? </li></ul><ul><li>- Segment revenue is the aggregate of: </li></ul><ul><li>- The portion of enterprise revenue that is </li></ul><ul><li>directly attributable to a segment </li></ul><ul><li>- The relevant portion of enterprise revenue </li></ul><ul><li>that can be allocated on a reasonable </li></ul><ul><li>basis to a segment, and </li></ul><ul><li>- Revenue from transactions with other </li></ul><ul><li>segment of the enterprise. </li></ul>Define enterprise revenue? Revenue from sales to external customers as reported in the statement of Profit and Loss.
  12. 12. What are the items excluded from segment revenue? a. Extra ordinary items as defined in AS 5, Net profit or loss for the period, prior period items and changes in accounting policies. b. Interest or dividend income c. Gains on sale of investments
  13. 13. <ul><li>Define segment expense? </li></ul><ul><li>Segment expense is the aggregate of: </li></ul><ul><li>- The expense resulting from the operating </li></ul><ul><li>activities of a segment that is directly </li></ul><ul><li>attributable to the segment, and </li></ul><ul><li>- The relevant portion of enterprise expenses </li></ul><ul><li>that can be allocated on a reasonable basis to </li></ul><ul><li>a segment, </li></ul><ul><li>- Including expenses relating to transactions </li></ul><ul><li>with other segments of the enterprise. </li></ul>
  14. 14. What are the items excluded from segment expenses? a. Extra ordinary items as defined in AS 5, Net profit or loss for the period, prior period items and changes in accounting policies. b. Interest expense c. Losses on sale of investments d. Income tax expenses e. General administrative expenses, HO expenses and other expenses
  15. 15. Define segment assets? Segment assets are those operating assets that are employed by a segment in its operating activities and that either are directly attributable to the segment or can be allocated to the segment on a reasonable basis . Define segment liabilities? Segment liabilities are those operating liabilities that results from the operating activities of a segment and that either are directly attributable to the segment or can be allocated to the segment on a reasonable basis .
  16. 16. What are the factors that influence the risks and returns of an enterprise? - Geographical location of its operations and - By the location of its customers. How to identify reportable segments as primary and secondary segments? If risks and returns of an enterprise are affected predominantly by differences in the products and services it produces, its primary format for reporting segment information should be business segments, with secondary information reported geographically. Similarly, if the risks and returns of the enterprise are affected predominantly by the fact that it operates in different countries or other geographical areas, its primary format for reporting segment information should be geographical segments, with secondary information reported for groups of related products and services.
  17. 17. What are the disclosure requirements for primary reporting format? - 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
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