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Final Dissertation

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Final Dissertation

  1. 1. Dissertation Student Name Ja Htu Aung Degree BA (Hons) Accounting Dissertation Supervisor Wendy Mason Burdon Dissertation Title An Analysis of Changes on Segmental Reporting after IFRS 8 Has Become Effective Date April 2015 Keywords IFRS 8, IAS 14, FRS 108, FRS 14, Segmental Reporting
  2. 2. i Declarations I declare the following:- (1) that the material contained in this dissertation is the end result of my own work and that due acknowledgement has been given in the bibliography and references to ALL sources be they printed, electronic or personal. (2) the Word Count of this Dissertation is ................................... (3) that unless this dissertation has been confirmed as confidential, I agree to an entire electronic copy or sections of the dissertation to being placed on Blackboard, if deemed appropriate, to allow future students the opportunity to see examples of past dissertations. I understand that if displayed on Blackboard it would be made available for no longer than five years and that students would be able to print off copies or download. The authorship would remain anonymous. (4) I agree to my dissertation being submitted to a plagiarism detection service, where it will be stored in a database and compared against work submitted from this or any other School or from other institutions using the service. In the event of the service detecting a high degree of similarity between content within the service this will be reported back to my supervisor and second marker, who may decide to undertake further investigation which may ultimately lead to disciplinary actions, should instances of plagiarism be detected. (5) I have read the University Policy Statement on Ethics in Research and Consultancy and the Policy for Informed Consent in Research and Consultancy and I declare that ethical issues have been considered and taken into account in this research. (6) I have read the University Policy Statement on Data Protection in Research and Consultancy and I declare that the data collected for use in this dissertation has been properly safeguarded and will be destroyed once the dissertation or subsequent research activity has been concluded. I acknowledge that it is my responsibility to destroy the information with due regard to confidentiality. SIGNED: .......................................................... DATE: ................................................................
  3. 3. ii Abstract Student Name JA HTU AUNG Degree BA (HONS) ACCOUNTING Dissertation Supervisor WENDY MASON BURDON Dissertation Title AN ANALYSIS OF CHANGES ON SEGMENTAL REPORTING AFTER IFRS 8 HAS BECOME EFFECTIVE Date APRIL 2015 Keywords IFRS 8, IAS 14, FRS 108, FRS 14, SEGMENTAL REPORTING The study gave emphasis to the International Financial Reporting Standard IFRS 8(Operating Segments) and the former standard IAS 14, which was superseded by the IFRS 8. The purpose of the study is to analyse the changes on disclosures in segmental reporting after the new standard IFRS 8 has become effective. Some of the issues developed from applying IFRS 8 will also be further analysed. According to the personal interest, sample companies are collected from Singapore Stock Exchange (SGX). IFRS is applied as a local version which is known as Singapore Financial Reporting Standard (SFRS) by SGX listed companies (PricewaterhouseCoopers, 2014). Hence, the IFRS 8 published by the IASB in converging with US GAAP is established as FRS 108 and the preceding standard IAS 14 is recognised as FRS 14 locally. Despite the local implementation, the material(s) of both the FRS 14 and its superseded standard FRS 108 are identical to IAS 14 and IFRS 8 in overall aspects (PricewaterhouseCoopers, 2012). For the above stated facts, the study on pre and post implementation review of IFRS 8 has been approached by examining on SGX 60 companies which are in full consistency with IFRS. The key findings are that under IFRS 8, Singapore companies have less disclosed their business segments and geographic segments due to one of the mandatory stages of IFRS 8 called aggregation of segments which allows
  4. 4. iii companies to combine the segments if they meet the specified requirements. However, the decreasing changes are not sizeable amount while comparing to the decline on the line items disclosed per segments under IFRS 8. Considerably, number of companies reporting segment assets, liabilities and capital expenditures has dropped dramatically in 2010 when IFRS has become effective. Last but not least, the Chief Operating DecisionMaker (CODM) has been voluntarily identified by many of the SGX companies. Keywords: IFRS 8, IAS 14, FRS 108, FRS 14, Segmental Reporting
  5. 5. iv Acknowledgements Firstly, I would like to thank my supervisor Wendy Mason Burdon for her excellent guidance and kindness throughout the research procedure. Without her support, guidance and useful feedbacks, this dissertation would never get to be done. Furthermore, I would also like to thank my friend, Emily Ramsden, who has always helped me whenever I found difficulties and encouraged me. Last but not least, I am thankful for the excellent service within the Library where I always worked for my dissertation.
  6. 6. v Contents Dissertation .........................................................................................................................1 Declarations......................................................................................................................... i Abstract.............................................................................................................................. ii Acknowledgements .............................................................................................................iv Contents..............................................................................................................................v Chapter 1 Introduction .........................................................................................................1 1.1 IFRS 8 (Operating Segments)..................................................................................1 1.2 Research Objective................................................................................................2 1.3 Explanation on the Subject Choice..........................................................................2 1.4 Explanation on the approach to the chosen objective..............................................3 1.5 Limitations of the study .........................................................................................4 1.6 Structure of the paper...........................................................................................4 Chapter 2 Literature Review..................................................................................................6 2.1 Introduction................................................................................................................6 2.2 Agency Theory............................................................................................................6 2.3 Review on IFRS 8.........................................................................................................7 2.4 Review on IFRS 8 in Earlier 2013...................................................................................9 2.5 Review on Segmental Reporting.................................................................................10 2.6 Review on the Number of Segments and Line Items per Segment................................12 2.7 Review on Aggregation of segments...........................................................................13 2.8 Review on Identification of the CODM........................................................................14 Chapter 3 Methodology......................................................................................................15 3.1 Introduction .................................................................................................................15 3.2 Research objectives...................................................................................................15 3.3 Data Collection .........................................................................................................16 3.4 Limitations................................................................................................................16 Figure 1 Sample Companies.........................................................................................17 3.5 Data Extraction and Analysing the Results ..................................................................18 3.7 Ethical Concerns........................................................................................................19 Chapter 4 Analysis and Findings ..........................................................................................20 4.1 Analysis on the Number of Reportable Segments........................................................20 Figure 2 Number of segments comparison....................................................................22 4.2 Items Disclosed per Segment.....................................................................................23 4.2 Items Disclosed per Segment (continued)...................................................................24
  7. 7. vi Figure 3 (continued)....................................................................................................25 4.2 Items Disclosed per Segment (continued)...................................................................25 Figure 3 (continued)....................................................................................................26 4.2 Items Disclosed per Segment (continued)...................................................................26 Figure 4 Items disclosed under Secondary Reporting Format.........................................27 4.3 Average Number of Line Items per Segment............................................................28 Figure 5 Average number of line items per segment......................................................29 4.4 Analysis on Chief Operating Decision Maker of SGX 60.............................................29 Figure 5 Chief Operating Decision Maker of SGX 60.......................................................30 Chapter 5 Conclusion..........................................................................................................31 5.1 Results Overview.......................................................................................................31 5.2 The Current Findingsin Consideration of Previous Literatures and Applied Theory........31 5.3 The Current Findingsin Consideration of Previous Literatures and Applied Theory........33 5.3 Limitations and Future Research................................................................................33 References.........................................................................................................................35 Reflective statement..........................................................................................................42 Acronyms...........................................................................................................................44 Appendices........................................................................................................................45 Appendix 1 .................................................................................................................45 Appendix 2 .................................................................................................................46
  8. 8. 1 Chapter 1 Introduction 1.1 IFRS 8 (Operating Segments) Segmental reporting is mandatory for company whose securities are traded publicly or those which are in the procedure to be publicised (IASPlus, 2007). The segmental reporting disclosed within the annual report of an enterprise must provide users of financial statements with the nature of the economic background in which that company operates and the fiscal effects of business transactions where it has engaged/involved (UNIT, 2009). IFRS 8, operating segments was issued by the International Accounting Standards Board (IASB) in conjunction with the US Financial Accounting Standards Board (FASB) in 2006, November (Veron, 2007). The standard has substituted its former standard IAS 14 for the purpose of better harmonisation between IFRSs and US generally accepted accounting principles (GAAP) (PricewaterhouseCoopers, 2008).This new standard IFRS 8 is defined as one of entity’s constituents, which comprises trade activities such as incurring revenues and expenses. The transactions of Income and expenditure incurred within one entity but different components are also recognised as operating segments (Ernst and Young, 2013). Under the new standard, companies must report its business or geographic unique segments which are qualified to disclose in annual reports by giving descriptive details such as financial information of those segments or aggregated segments operated within their firms (Iasplus, n.d.). Business segments are related to products and services of companies while the geographic segments are the segments of different regions in which they operate and their major customers are located (Iasplus, n.d.). The results of those operating segments of an entity are evaluated systematically by its Chief Operating Decision Maker (CODM) for the purpose of deciding the allocation of the resources toward the segments and evaluating the functioning of those segments. Separate financial reporting is also presented within entity’s operating segments (Deloitte , n.d.).
  9. 9. 2 The constraints and specifications of segmental reporting according to the US Statement of Financial Accounting Standards (SFAS 131) is largely equivalent to the IFRS 8 with only slight dissimilarities (IFRS , 2006). A number of criticisms have been derived over the new standard. According to the review studied by the staffs of IASB in 2013, the major issues upon IFRS 8 are that relying on the management perception before identifying the operating segments, the usage of measurement which are not within the IFRS 8 standard and last but not least the absence of providing information about the CODM who make decision about the line items to disclosed within the segmental reporting. 1.2 ResearchObjective The main purpose of the study is to examine on how the replacement of IFRS 8 over IAS 14 has impacted on the disclosures of companies registered on Singapore Stock Exchange (SGX). This present research targets in achieving a better understanding on the nature of segmental reporting and how the new standard have affected on the disclosures which provide useful information to users. 1.3 Explanation on the SubjectChoice A few considerations have been taken into account before collecting data from the SGX listed companies. The previous research papers on IFRS 8 in particular have tested mostly on European companies including UK FTSE companies which adopted IFRS. Hence, the limitation issue has arisen while selecting companies to examine at first as the rest of the companies world-wide have adopted different standards such as US GAAP etc. in preparing their annual reports. Therefore, the current research will be assessing on Singapore firms, one of the Asian companies which applied IFRS locally for some favourable reasons. Firstly, in addition to the personal interest, the Singapore annual reports have found to be very efficient in approaching the purpose of this study because the publicly established reports are written in full English for the understanding of users worldwide. Secondly, the Singapore reports are also rewarded annually for their excellent accounting statements in order to motivate the preparers for a better performance in presenting the annual report (Singapore Corporate Awards , 2014). Therefore, the disclosures are professionally well-established
  10. 10. 3 with full detailed information and broader scope which will benefit the users such as investors and stakeholders. In Singapore, financial reports are prepared according to its own local version called SFRS. Thus, the IFRS 8 is known as FRS 108 and the former standard, IAS 14 is adopted as FRS 14 (PricewaterhouseCoopers, 2008). However, the SFRS is largely aligned with IFRS in many aspects and thus the material features of FRS 108 and the early standard FRS 14 in particular are considered to be fully consistent with IFRS 8 and IAS 14 respectively ( PricewaterhouseCoopers, 2012). Last but not least, the topic and SGX listed companies are chosen as there is no such research that has been studied on this particular area of segmental reporting previously except from Wilkins and Khoo (2012). Although the paper was on segmental reporting the research goals were different (see IFRS, 2013). For above stated reasons, the study on pre and post implementation review of IFRS 8 has been approached by examining on SGX companies which are in full consistency with the IFRS 1.4 Explanation on the approachto the chosen objective According to the (Deloitte , n.d.) , the IFRS 8 was established by November 2006 after its Exposure Draft has been delivered; effective for annual accounting periods beginning on 1 January 2009 and onwards. Under these circumstances, the main objective will be obtained by comparing the annual reports of SGX companies as at 31st December 2010 against those stated before the effective date; 31st December 2008. Based on the main objective, three research questions have been derived in order to know the impact of IFRS 8 on segment disclosures. Numerical data on the segment numbers, items disclosed under each segments such as business and geographic segments and the CODM identification by SGX chosen companies will be collected to compare and analyse the annual reports under the two different years to answer the three research questions. The final objective of the study will be attained from these numerical data analysis. Furthermore, issues arisen in IAS 14 and IFRS 8 will be further examined.
  11. 11. 4 1.5 Limitations of the study Initially, the study obtained 100 SGX companies as others researchers such as Crawford et al. have also studied approximately 100 companies. Due to a number of limitations the final companies which will be testing are 60 and further explanations of limitations upon the selections of companies will be discussed in the next section, methodology. 1.6 Structureof the paper The dissertation is structured in the following way. In the first chapter, the overview of IFRS 8 will be discovered by giving detail information on the background of it and highlighting on the purposes of the study and how will the research aims will be achieved. Followed by the introduction chapter, the literature review on IFRS 8 and segmental reporting will be explored in order to support the research questions. Theory associating with the segmental reporting will be also explained in terms of its relevance to research topic. Last but not least, the current literature has also reviewed on the issues arising on IFRS 8. However, this literature has not revised upon the local standard FRS 108 particularly due to the standard being identical to the original standard IFRS 8 in overall standard’s perspectives as stated earlier (PricewaterhouseCoopers, 2008). Next chapter will be presenting on the methods which have been used to collect and analyse the data to answer the research questions. Prior to explaining the data collection methods, where the raw data have been obtained from, have stated with providing limitations experienced throughout the procedure. Consequently, the final step of the methodology which is the explanation of how the data will be analysed and derived to the results will be explained in details. Ethical concerns upon the current research have also included verifying the study follows the university ethic guidelines. The last chapter is about the analysis and findings which has derived from the previous work. The statistics results such as the number of segments disclosed and items per segments disclosed etc. will be explored by linking between each variable. The relevant theory as stated above in the literature section will be linked back to the final complete results.
  12. 12. 5 Last but not least, the partial of this research paper will be summarised by bringing key aspects of the literature which have been discussed in the above section in comparison with the complete research findings. This piece of summarising will bring a connection to the methods that have applied to analyse the research questions. Self-recommendation has been made on the previous authors’ work by justifying their limitations within their studies and further contradictions against them have also been made by the current findings. Therefore, this present reflective understanding on IFRS 8 has developed the study area with further information and the connection between the current dissertation and the former studies has also been clearly identified.
  13. 13. 6 Chapter 2 Literature Review 2.1 Introduction The purpose of this chapter is to review the areas in alignment with the research goal of the current study which is whether the companies’ segmental disclosures listed on SGX (Singapore Stock Exchange) have reformed after the new standard IFRS 8 (adopted as FRS 108 locally) has taken place. 2.2 Agency Theory The supporting and underpinning theory behind the segmental reporting will be also explained in details. Based on the conception of agency theory, there is always asymmetric information between the principal and agent. The asymmetric information derived from the knowledge gap between the perfectly exposed company’s information which give reliable data or facts and that of information which are not completely reliable (Eisenhardt, 1989). In this study of segmental reporting, the principals are investors or shareholders and the agents are those people in charge for management such as companies’ managers. Managers operate within the business and hence also known as internal users while the shareholders are the external users who do not have direct access to the information relating to the business they are invested in (Quinn and Jones, 1995). Therefore, one question has derived over the relationship between the principal- agent: how the shareholders can assure that the decisions made by management are in line with their interests? Because the two individuals have their own different strategies in pursuing the business target. For example, the stakeholders focus on raising profits for high returns while the management’s goal is to add value on the companies along with the wealth maximisation for their own. The value managers have created may not be parallel to the value that the shareholders are expecting for (Douma and Schreuder, 2008; Eisenhardt, 1989; Jensen and Meckling, 1994). The answer to the above question is the financial reporting which is an essential and compulsory tool for all the shareholders and investors. According to Aitken et al. (1997), Consolidated information which is a component of financial reporting alone does not help the investors much to see
  14. 14. 7 the risks and the return or the information about the business components, especially when the profits obtained from business segments are not consistent to each other. Therefore segment reporting is used to reduce the asymmetric information between the investors and the company management by providing detail financial statement of each segment (Yoo & Semenenko, 2012). Essentially the sole purpose of segment reporting is to help the investors to understand the company as a whole by breaking down the information to the level where it is easy to access and understand (Troberg et al. 2010). Therefore, segment reporting can be seen as a way to solve principal-agent problem. 2.3 Review on IFRS 8 Regarding the study objective, analysis such as the issues and usefulness of the new IFRS 8 will be presented in this section of literature review. Firstly, one of the key components of the new standard called the management approach will be critically examined as there are many judgements made upon the potential issues which can derive from it (IFRS, 2013). It is obligatory under IFRS 8 that companies report its segments related information on business and geographic sectors if they meet specified criteria (Deloitte , n.d.). Consequently, a company’s segmental reporting regarding the business operations must be measured and identified through the “management approach”. Thus, segmental reports are required to describe in alignment with the internal management scheme revised frequently by the Chief Operating Decision Maker (CODM) according to IFRS 8 (PricewaterhouseCoopers, 2008; Farías & Rodríguez, 2014). Numerous criticisms have derived over the approach through management’s insight and (Sukhraj, 2007b; Veron, 2007a) mentioned that the new innovated approach could be a failure and inefficient (as cited in Crawford et al. 2013). Report prepared by the PricewaterhouseCoopers (2008) have further pointed the pitfall of management approach by stating that information which are prepared thoroughly by CODM or management team will not be supported by external audit or some robust processes. In addition, the two papers prepared by Crawford et al. 2010 and Crawford et al. 2012 have also done much research on the problematic issues of the segment disclosures under IFRS 8. However, this judgement on management approach could be argued by the result findings of interview prepared by Crawford et al.
  15. 15. 8 (2012). Because 20 participants out of 11 assumed that the recent management approach of IFRS 8 is considerably more beneficial with extra reliable information than the former approach of IAS 14 which measured the segment reporting by using IFRS- compliant business information. Moreover, the survey work done by CFA UK, 2012 also have in common with the Crawford’s survey outcome which states that IFRS 8 has equipped the analysts and users with greater knowledge about companies. However, from the self-perspective view, this empirical result seems to solely rely on the preparers’ judgment but not on the users’ point of view (as cited in Tarca & Pitman, 2013). Correspondingly, the further analysis enhanced from the continuing comment letters by the European Commission, 2007 has proven that the exposure draft (ED) 8 of FRS 8 has supported predominantly by the preparers (Crawford et al. 2010). Along with the management control, the results of the entity’s operating segments are evaluated systematically by its Chief Operating Decision Maker (CODM) for the purpose of deciding the allocation of the resources toward the segments and evaluating its functioning (PricewaterhouseCoopers, 2007). Separate financial reporting is presented within entity’s operating segment (Deloitte, n.d.). Previous reports by ESMA, 2011 and AASB, 2013 have reviewed on particular area such as CODM identification, which is one of the stages in applying IFRS 8; the CODM must revise the results of the operating segments within the lines called product and geographic on a regular basis(Ernst & Young, 2009). The disclosing number of segments and further proper information could be reduced for applying this step. As a result, the purposes targeted within the principle could not be fully achieved. Furthermore, the outdated approach through management could be complicated and difficult to apply in reality as it is based on the rules set by the CODM rather than principal-based (Herrmann & Thomas, 2000). However, this Herrmann and Thomas’s study seems to have a gap within their literature as there are two inconsistent statements made upon the management approach strategy. Because they have also concluded by stating the segmental reporting has become more reliable and efficient due to its consistency and
  16. 16. 9 better accurateness under the CODM’s management (as cited in Crawford et al. 2010). Sukhraj (2007a) has also criticised on the CODM for not being allocated and recognised specifically but selecting from the range of random directors such as financial directors and board directors. However, the shortcoming of CODM information is likely to be included in future annual reports due to several criticisms raised over it. All of the above authors have commented that in the real world, the criticisms have arisen on the identity of CODM who are making decisions over segment reporting. Despite the growing condemnations, the post-implementation review by (IASB, 2013) have drawn conclusion by giving credit on the new standard, IFRS 8 that the advantages obtained from adopting the IFRS 8 has a greater impact on disclosures (Deloitte, n.d.). 2.4 Review on IFRS 8 in Earlier 2013 In earlier 2013, the comment and review on IFRS 8 have been limited due to the standard havig been revised only after it is adopted globally. Hence, only a short-time frame was available to criticise the complete standard before 2013 as the IFRS 8 has become effective on 1 January 2009 (see Crawford et al. 2012; H. Mardini, 2012; Mardini, Crawford, & Power, 2012).So with just around 2 years straight after the IFRS 8 has been applied by entities worldwide, a few responses on the impact of implementing the new standard have been made by some organisations and authors such as European Securities and Markets Authority (2011), Veron (2007), Crawford et al. (2010) and European Commission (2007). Most of the authors who did their research before 2013 have also judged on the similar issues such as the management approach and the recognition of CODM which derived under the implementation of IFRS 8 regardless of the time frame of reviewing. Although most of the authors have focused on the identical areas, a few of the literatures of IFRS 8 were published prior the standard becoming effective, for example: Veron (2007); European Commission (2007). As a result, those past studies’ findings seem to have made little comment on overcoming with the controversial problems and lack of proof based on empirical data. Therefore,
  17. 17. 10 regardless of the contents that have covered relevant and useful areas, they have concluded only on particular aspect among the several potential issues of the standard and thus incomplete in nature. Noticeably, Veron (2007) has given a bold definite statement by summarising due to the downsides of the IFRS 8; it should not be adopted urgently by the European companies. 2.5 Review on SegmentalReporting Secondly, the literature will be reviewing on all the standards of segmental reporting from the past to the current respectively in specific with the standards’ issues. Segmental reporting is one of the most important compulsory financial disclosures for the users of annual reports (Brown, 1997). The rationale behind segmental reporting is that the mandatory consolidated statements disclosed within the entities’ annual reports are not abundantly adequate as it lacks in providing complete useful financial information to the external and internal users. Therefore, business related information has been separated into individual segments and hence called segmental reporting (Roberts, 2010). A number of benefits and drawbacks have arisen upon segmental reporting due to different judgments made by previous researchers. Numerous authors have studied on how the data of segment plays a significant role for decisions over investment and stock market (see Hope et. al., 2008; Epstein and Palepu, 1999; Berger & Hann, 2003; McKinnon & Dalimunthe, 1993; Herrmann & Thomas, 2000; ESMA, 2011). However, different evidences have been presented concerning the above statement. Such as previous study of Epstein and Palepu, 1999 showed by the results obtained from the contemplation of 140 financial experts such as “sell- side analysts” (as cited in Berger & Hann, 2003) and the other authors, McKinnon & Dalimunthe, 1993 have given a bold argumentative statement of that the history of the company performance can be recognised under the segment reporting sector and thus users must view them for future predictions of the enterprise. For example, a large-cap bank normally issues the segments report on its discrete financial services such as retail banking, corporate banking, etc. Essentially, the discrete fiscal information has much influence on the liquidity of a large-cap company as they are essential for the users of annual
  18. 18. 11 reports to acknowledge whether they should invest in that particular company or not (Berger & Hann, 2003). In addition to those indications, (Berger & Hann, 2003; Balakrishnan et al. 1990) have also further analysed on whether the improvement in accuracy of predictions on an enterprise’s income and trades history has associated with the accessibility of segmental reporting. The result obtained by them appear to be consistent with those of above authors’, which is segment reporting matters for a variety of users and analysts to some major extent. Though these authors have done much research on the benefits of segmental reporting, they seem to have ignored the downsides. Nichols et al. 2013; Emmanuel et al. 1999; Parker and Sauer 2009; Edwards and Smith, 1996 have largely centred on the issue about segmental reporting being contentious. Such as, concerns have derived from the criticisms of the new standard, IFRS 8 including the application of management control scheme and the non-IFRS measurement usage, the possibility in reducing number of reported segments on the geographic sector, and elimination of disclosing the line items such as segment liabilities (Crawford et al. 2012; Crawford et al. 2010; Nichols et al. 2012). Not only is the current standard of segmental reporting IFRS 8 problematic but also the very original standard of segment reporting, Statement of Standard Accounting Practice (SSAP) 25 had certain issues regarding to its disclosures which are mandatory for companies Edwards & Smith (1996) (as cited in Crawford, Helliar & Power, n.d.). Further concerns derived under SSAP 25 were about not complying with segment disclosures geographically (Edwards & Smith, 1996; Rennie & Emmanuel, 1992). On the other hand, (Jermakowicz & Gornik-Tomaszewski, 2006; Crawford et al. 2010) stated concerns derived from the issues within companies’ disclosures under the previous standard IAS 14. Further critics are made on the segments aggregation (Nichols and Street, 2007); and the segment disclosures’ quality and quantity (Street and Nichols, 2002). However, these above concerns appear to be momentary as the ground- breaking standard IFRS 8 has evolved in 2009.
  19. 19. 12 2.6 Review on the Number of Segments and Line Items per Segment Last but not least, the literature on how the IFRS 8 has affected the primary and secondary disclosures of segmental reporting such as business and geographic segments reporting will be reviewed. Business segment is a unique part of the whole business that has a distinct product or service. It also has unique risks and returns. Geographical segment is based on unique economic environment that produces products or services. Different geographical segment has different risks and returns (Iasplus, n.d.). Both IAS 14 and IFRS 8 require a business to report relevant information such as business and geographic segments separated from their business as a whole. The formats of reporting those two segments are divided into segments disclosing of primary and secondary (Ernst and Young, 2009). Numerous researchers have studied over the changes upon the number of segments and line items per segments reported within the primary and secondary disclosures when IFRS 8 has become effective by collecting data and preparing survey (see Crawford et al. 2012; Mardini et al. 2012; Nichols et al. 2012; Kang and Gray, 2012; Bugeja et al. 2012; He, He and Evans, 2012; Heem and Valenza, 2012). Based on those previous findings of (Mardini et al. 2012; Nichols et al. 2012), it is likely to be that the segment numbers of business and geographic sectors disclosed have not changed since IAS 14 although separate segments can be merged together if they meet the specified requirements under IFRS 8 (Pricewaterhousecoopers, 2008). The study of (Bugeja et al. 2012) upon the 1,617 Australian listed firms also has similar outcomes with them, resulting in 79% of segments quantities remaining constant. On the other hand, numerous companies have also experienced an upturn on the segment numbers according to the post implementation review prepared by the (IFRS, 2013; Moldovan, 2014; IASB, 2013a; ESMA, 2011; AASB, 2013). Parallel to these findings on the review of implementing IFRS 8 is the Crawford et al. 2012 as 150 sample companies taken from FTSE 100 and 250 disclosed increase segment amounts, resulting an average growth of 0.26 under IFRS 8.
  20. 20. 13 Although most researchers analysed the number of segments changes based on the secondary sources, primary data method seems to be used by only a few researchers including Crawford et al. 2012. Moreover, there is absence of supporting reasons behind the increase segment numbers by most of the studies comprising Crawford et al. 2012. In fact, a decline in the mean numbers of business or geographic segments reported is considered to be relatively small comparing to the increase overall (Tarca & Pitman, 2013). However, the results can still be varied based on the individual companies disclosing them. While there is an escalating result on segment numbers under IFRS 8, the line items disclosed for each segment called business and geographic reporting has decreased comparing to those disclosed under IAS 14 (Weissenberger and Franzen, 2012a; Crawford et al. 2012; He et al. 2012; Nicholas et al.2012). Mardini et al. 2012 have an opposing result to them although the difference within the increase and decrease is not sizeable or significant. Despite the total line items disclosed under both reporting formats have undergone a decline, He et al, 2012 has stated that companies disclose more items such as intersegment revenue, interest expense and revenue and income tax rather than segment assets, liabilities and capital expenditure(as cited in IASB, 2013). Furthermore, in accordance with the review prepared by the member of IASB in 2013, the declining line items under each segment reporting is likely to be caused by the management approach which is to report to the CODM in advance before disclosing those line items. 2.7 Review on Aggregation of segments IFRS 8 has allowed the combination of segments to form into one category if they have met certain specified criteria (IASB, 2012). Based on this action, (ESMA, 2011; Backhuis and Camfferman, 2012) have discussed about the segments aggregating process under IFRS 8 (as cited in IFRS, 2013). According to the review on several study papers prepared by (ESMA, 2011), the opinion of those researchers who analyse upon the segment aggregation can be observed that minimising the segments into one group can result in the absence of providing essential information to users.
  21. 21. 14 However, these are just a prediction made by those forecasters who seem to have ignored proof to the statement. The finding by the (CFA UK, 2012) also have a common to the ESMA report as most of the analysts tend to favour the disaggregation rather than aggregation of segments as they personally think to be more efficient. Last but not least, (KPMG, 2010) have also judged upon the absence of explanation details about the aggregated segments by companies’ disclosure. 2.8 Review on Identification of the CODM Stemming from the issues arisen upon the absence of providing who the CODM is, a number of analysts have carried out by taking sample companies to examine how many companies have been identifying the identity behind the CODM (see Nicholas et al. 2012; ESMA, 2011; KPMG, 2010; Kang and Gary, 2012; Crawford et al. 2012). Among those analyses, the sample companies performed by the (Crawford et al. 2012; Kang and Gray, 2012) have the most number of companies which identified the person who is in charge as CODM, resulting 69% and 82% respectively. Followed by this, the 36% European sample companies analysed by Nicholas et al. in 2012 have also identified the CODM. Furthermore, it has been observed by (KPMG, 2010) that 33% of chosen firms have given the detail information about the CODM. Undoubtedly, CODM duty is given the most to the management team followed by it are the CEO (Kang and Gary, 2012; Nicholas et al. 2012).
  22. 22. 15 Chapter 3 Methodology 3.1 Introduction This chapter justifies how and where the relevant data have been collected to examine the research objectives. As mentioned in the earlier chapters, IFRS 8 superseded the former standard IAS 14R and hence the segmental reporting has been adjusted and changed under the new principles of IFRS 8 (Deloitte, n.d.). Through the segmental reporting, the changes on structure within the company and the past performance are measurable (Botosan and Harris, 2000). Therefore, the alteration of this essential segmental reporting can be a very sensitive case because of its importance in making decisions for investing to stakeholders. Stemming from the literature studied in earlier sections on the new management approach of IFRS 8, (Nichols et al. 2013; Crawford et al. 2012; Parker and Sauer, 2009; Pricewaterhosuecoopers, 2007) stated that the business or geographic segments reported is expected to develop under the control of management by the CODM. However, the CODM is not always identified and therefore concerns have been arisen. Although the impact of IFRS 8 on disclosures for UK has been investigated as it plays a major role (Crawford et al. 2012), none of the research paper has completed on how the Singapore companies have affected from the IFRS 8. 3.2 Researchobjectives Subsequently, the following four questions will be analysed: RQ 1: Have the numbers of reported segments changed after IFRS has become effective? RQ 2: How many SGX listed companies have changed their reportable number of segments after the new standard is introduced? RQ 3: Have the line items within the segmental disclosures changed after IFRS 8 has taken place over IAS 14? RQ 4: Have the CODM been recognised under the segmental reporting? These objectives have been chosen based on the completed present literatures for the following reasons. Firstly, there is lack of evidences from world-wide companies on the implementation of IFRS 8, especially from Singapore which implemented IFRS locally (Section 1.2). Secondly, are expectations and
  23. 23. 16 statements made by various authors about the changes on the quantities of segments and line items as the management approach occupied also applicable to Singapore companies (Section 2.4)? The last reason is to see whether the controversial issues of not identifying who is the CODM that is making the decisions about segment reporting has been cleared to Singapore companies (Section 2.6). 3.3 Data Collection In order to answer the above research questions, numerical or quantitative data such as number of business and geographic segments, number of companies disclosing the line items which are compulsory under IAS 14 for each of the primary and secondary reporting format. Last but not least the data of number of companies identifying the CODM will also be collected. All of these raw data have hand-collected from secondary sources such as annual reports published within the SGX for two different years of 2008 and 2010 which are the years that IAS 14 was still in use and IFRS 8 has become active respectively. The reason for favouring the quantitative approach is because the key research areas are the number of segments and number of line items per segment which can be simply and effectively analysed by the measurement of statistics (Horn, 2009).From the stage of analysing the raw data, a precise statistics research answers will be obtained. 3.4 Limitations The SGX has divided its listing into two different sections known as the mainboard and catalist listings. The previous authors (Kajuter and Nienhaus , 2012; Pisano and Landriana, 2012; Mardini et al. 2012 ; Crawford et al. 2012) have selected approximately 100-150 companies whilst analysing the IFRS 8 versus IAS 14R. Therefore, this current study has also chosen the top 100 companies from a mixture of diverse listings established publicly on SGX. However, according to (Walliman, 2004), the further limitations can be encountered while collecting data using secondary sources. Firstly, as it is a tough job to research and access relevant data which have been recorded in the past, these 100 companies have to be selected again from the various sectors as some categories of businesses are inconsistent with other remaining types of firms. For example, the companies under banking sector will not be considered due to more complex additional information reported on segment disclosures (e.g. Prather-Kinsey & Meek, 2004; Street et al. 2000).
  24. 24. 17 Consequently, collecting segmental info from the banking firms has been limited by lack of harmonisation. Numerous reliable sectors such as food products; oil, gas and consumable fuels; hotels, restaurants and leisure sectors; technology products etc. have selected to analyse. Secondly, authenticating the relevant resources which have been obtained for current study is very challenging and time consuming. Although top 100 companies are picked from these sectors, (9) enterprises from them are excluded because they registered on SGX later than 2008, which is the year that IAS 14R was still in use. Moreover, further (20) companies are also eliminated because they are incorporated within overseas (SGX, n.d.). Lastly, (11) more companies are withdrawn at the end after collecting the raw data of them because the data within those disclosures are listed in contentious and unclear format and mixed language (see Figure 1). Due to this fact, about 40 companies are disqualified in approaching to answer the research questions. Finally, the numbers of companies which have remained to analyse are 60 (Appendix 1). Although, there are some limitations experienced from using secondary data sources, the weighing of limitation for primary sourcing method seems to exceed the secondary one as it involves man power and more ethical related issues which can have more boundaries. Hence, although primary method was in favour of using in the first place, it has been abstained due to lack of participants in primary survey. Figure 1 Sample Companies Figure 1 Final Sample CompaniesSelectionProcess No.of companies Initial selectionofTop SGXcompanies 100 Less: RegisteredonSGX later than 2008 -9 Incorporated withinother countries -20 Usage of inconsistentformat and mixedlanguage -11 Final Sample 60 Note: This figure shows the sample companies selection process.
  25. 25. 18 3.5 Data Extraction and Analysingthe Results As the overall research objectives are abstracted from the outcomes of applying the cutting-edge standard, IFRS 8 in disclosures, the answers to them will be achieved by comparing the 60 SGX listed companies’ segmental reporting under IFRS8 and IAS 14. IAS 14 became effective in 1998 and lasted till the IFRS 8 has replaced it in the 1st January 2009 (Iasplus, n.d.). Therefore, the data from the SGX 60 annual reports published in the year 2008 and 2009 will be hand-collected each. Although, there are accessible data sources on its own SGX main website and Bloomberg financial website, the current data have been selected manually as they are not financial related data such as dividend and revenue and thus not accessible through those financial websites. To answer the first research question (Section 3.2), the data of business and geographic segments of companies have extracted from segmental information disclosed within the annual reports of the two different years. Excel software is used to analyse and test the result by using those obtained data from a total of 142 annual reports. This software has been chosen for several reasons. Firstly, it is capable of restoring large amount of data collected in a spreadsheet. Secondly, many useful functions and formulas such as mean (average) etc. have been provided to present the summarisation of cluttered data. Lastly, the data analysis of the IFRS 8 versus IAS 14 can be completed without hassles as it allows flexible filtering and searching tools to find and examine vast information quickly. The raw data will be keyed in into the excel spreadsheets. And mostly the Excel by Microsoft has chosen for its easier accessibility than other software like SPSS. After transferring the raw data in the chosen Excel spreadsheets, they are stored securely and analysed. Computations are carried out by using excel generated formula such as mean formula etc. For the second research question (see Section 3.2), each of the companies which made changes to their segments reported are keyed in to the created excel spreadsheet. In order to obtain the data of increased and decreased total number of companies, record of the companies which have either inclined or declined in their segments numbers disclosed have also collected in columns. The final result for this question has obtained by using the Excel summary formula to get those total companies affected by IFRS 8. The following two
  26. 26. 19 research questions have also obtained by applying those similar method routines or formulas to the relevant collected raw data. In these ways, the analysis stage of the study will be effectively accomplished by the advantages of Excel as the variables which are stored within the tables can be easily linked together in relationships (Horn, 2009). The final complete results and comparisons of the numerical data are also presented by creating table by Excel. 3.6 Reliability of Secondary Data The whole analysis and results are based on the secondary data obtained from the original annual reports prepared by the Singapore companies. According to the SGX, the annual reports are the final and official work disclosed by the companies registered on the SGX. Therefore, the data currently obtained are trustworthy and genuine. Although the numerical data are difficult to be precise and consistent in nature as stated in the (sagepub, 2007), this statement mostly applies to financial data. As the whole analysis have been relied on the non- financial data such as the number of segments, and line items disclosed per segments, the secondary data in this particular research paper is reliable and reputable. 3.7 Ethical Concerns The whole procedures and objectives of the research are carried out and achieved by obtaining numerical data from annual reports which are publicised in Singapore Stock Exchange (SGX) and secondary research format. Therefore, no human participants will be involved in this current study. According to Singapore Companies Act which has revised in 2006 , further usage of companies’ annual reports are lawful as the reports are meant for external users such as investors and shareholders to learn about the company prior to investing (Singapore Statutes Online, n.d.). A copy of ethical issues form will be included for future reference (Appendix 2).
  27. 27. 20 Chapter 4 Analysis and Findings 4.1 Analysis on the Number of Reportable Segments Figure 2 illustrates the average number of segments. This figure has divided into two sectors called SGX mainboard and SGX catalist which is also known as the secondary listing (SGX, n.d.). SGX mainboard involved 38 firms and the catalist listing included 22 firms (see Appendix 1). Firstly, the average number of business segments for the mainboard has decreased by 0.05 under the disclosure standard of FRS 1081 (IFRS 8) as it dropped from 2.97 segments in 2008 to 2.92 segments in 2010. However, the average numbers of segments for the 22 firms under SGX catalist has remained constant since 2008, the year FRS 142 (IAS 14) was still active. Therefore, the overall 60 SGX companies’ business segments have experienced a slight decrease of 0.03 under FRS 108. Following the results from the (Section 1 and Section 2), the results for the number for the number of companies reporting a change in the number of segments have been derived. Remarkably, total number of companies which encountered a decrease is 12 out of 60 while 13 companies have experienced an increase number of segments although the mean number of segments for total 60 firms has reached a decline of 0.03. The reason behind these uncommon figures of decreased segments while the total numbers of companies which have experienced an increase are more than those companies decrease is because the companies have disclosed lesser segments of more than one under FRS 108. For example, a company has disclosed 5 business segments in 2008 and the segments reduced to 2 in 2010 and this cause the total mean number of segments to be declined more. Furthermore, as mentioned in the earlier literatures, the reason of fewer segments reporting could be due to the aggregation among them. Furthermore, both the geographic segments by location of customers and assets have declined from 2008 to 2010 correspondingly as business segments (Section 1.2). 1 FRS 108 is a local version of IFRS 8 which is identical to IFRS 8 in all material aspects (PwC,2012). 2 FRS 14 is a local version of IAS 14 which is identical to IAS 14 in all material aspects (PwC,2012).
  28. 28. 21 The mean number of geographical segments by customers’ locations for both SGX mainboard and catalist has a slight fall from 4.37 to 4.29 and from 3.73 to 3.41 respectively and a total difference mean number of 0.20 have resulted from it. Likewise to the business segments, the number of companies which encountered an increase in the geographic segments by where the customers are located is more than a decrease regardless of a decline in the mean number of geographic segments disclosed (Section 2.2). Out of 60 firms 35 firms have not made a change on their geographic segments based on customer’s regions. Last but not least, the geographic segments depending on the companies’ assets’ location have the most decline mean number among the other segments, resulting a difference in the mean of 0.29 (Section 1.3). Reasonably, there is more decrease number of companies in total than increase as the mean number of segments has decreased under FRS 108 (Section 2.3). The total number of companies dropping its segments number is 16 while a total of 8 companies have increased their segment numbers. 36 companies do not make a change on their segment disclosures hence both of the segments reported before and after IFRS 8 remain unchanged since 2008. As is observed from the above given statistics, the overall segments operated within the business have reduced under the new standard IFRS 8 (FRS 108). Therefore, the final outcomes based on the SGX 60 companies for the number of segments reported have an opposing result figures from those literature findings stated above as most of the researchers’ have an increased number of segments disclosed within their chosen companies (Section 2.6). However (ESMA, 2011; IASB, 2013) have also mentioned about those European companies experienced a decline in their operating segment numbers. In addition to this, ESMA has stated the business or geographic segments have reduced due to the alteration of structure within the business. For instance, changes involve activities such as acquisitions, withholding or disposal and organisation structure amendment regarding to internal operating (ESMA, 2011).
  29. 29. 22 To conclude, the numbers of segments within the segment disclosures have changed as they decreased under IFRS 8. Figure 2 Number of segments comparison Section (1) Comparison of number of segments provided under IAS 14(FRS 14) and IFRS 8(FRS 108) SGX Mainboard SGX Catalist Total Sample Section 1.1: Business/products& services IAS 14(FRS 14) (2008) 2.97 3.36 3.17 IFRS 8 (FRS 108) (2010) 2.92 3.36 3.14 Difference in the mean -0.05 0.00 -0.03 Section1.2: Geographic by location of customers IAS 14 (FRS 14) (2008) 4.37 3.73 4.05 IFRS 8 (FRS 108) (2010) 4.29 3.41 3.85 Difference in the mean -0.08 -0.32 -0.20 Section1.3: Geographic by location of assets IAS 14 (FRS 14) (2008) 3.79 2.27 3.03 IFRS 8 (FRS 108) (2010) 3.39 2.09 2.74 Difference in the mean -0.39 -0.18 -0.29 Section(2) Numberof companiesreporting a change in the number of segments SGX Mainboard SGX Catalist Total Sample Section2.1: Business/products& services Numberof Companies 38 22 60 Increase 6 7 13 Decrease 7 5 12 No Change 25 10 35 Section2.2: Geographicby locationof customers Numberof Companies 38 22 60 Increase 7 6 13 Decrease 8 4 12 No Change 23 12 35 Section2.3: Geographicby locationof assets Numberof Companies 38 22 60 Increase 5 3 8
  30. 30. 23 Note: This figure illustrates descriptive information about the number of segments. The statistics data are collected from 60 SGX companies for 2008 and 2010. Section 1 displays the mean number of segments for SGX mainboard, SGX catalist and total SGX 60 companies. Section 2 illustrates the number of companies which have increased, decreased and not changed the segments which they disclosed since 2008 to 2010. 4.2 Items Disclosed per Segment Figure 3 represents a list of items reported under primary reporting format. These line items are acquired from line items which are obligatory under IAS 14 in order to measure how many line items have been omitted under the new disclosure standard. Mostly, business segments information is disclosed as primary reporting. However, there are also some companies whose geographic segments are reported by using primary format while the business segments are disclosed under secondary reporting format (mca.gov, n.d.). For instance, if the company risks and returns are mostly dependent and based on what it produces and offers such as products or services, the business segments information are reported by using primary reporting format while its geographic segments are reported in secondary disclosure format. Inversely, if the risks and returns are highly affected by where those products or services are sold or operated such as geographical regions, those geographic based segments are reported by using primary reporting format while the business based segments are reported under the format of secondary reporting (Altaf, 2014). Regardless of more than half of the SGX 60 companies disclosed identical business and geographic segments without making a change since IAS 14 to IFRS 8 (Figure 2 of Section 2), some of the line items disclosed under business and geographic segments have changed when IFRS 8 superseded IAS 14 for SGX 60 companies (See Figure 3; Figure 4). According to Figure 3 of section 1, it is remarkable that approximately half of 32 SGX mainboard companies (17) which disclosed capital expenditure in 2008 have excluded it from disclosing in 2010, leaving a percentage of 45% from Decrease 12 4 16 No Change 21 15 36
  31. 31. 24 84%. There is only a slight decrease in the number of SGX mainboard companies disclosing the depreciation line when IFRS 8 is occupied as it dropped from 35 to 31 in 2010. Followed by this item, segment results of continued operations and discontinued operations, total assets and liabilities have also reduced by a difference in the percentage of 29%, 2%, 20% and 29% correspondingly. Last but not least, it can be learnt that all the 38 SGX mainboard sample companies have disclosed line items such as revenue obtained from customers and inter-segment revenue in both years despite the standard has changed from IAS 14 to IFRS 8. Figure 3 Items disclosed under primary reporting format Note: This section illustrates the line items included by SGX mainboard companies under primary reporting format. 4.2 Items Disclosed per Segment(continued) Further analysis of SGX 22 catalist companies has presented (Section 2 of Figure 3). Unlike SGX mainboard, items such as revenue by customers and inter-segment revenue have slightly changed in the number of companies disclosing those two line items. As can be seen in the table, all the percentages of companies disclosing the line items under primary reporting format have Section1: Primary/operating segmentdisclosures SGX Mainboard Primary/operating segmentdisclosures(perIAS 14R) Pre IFRS 8 (FRS108) PostIFRS 8 (FRS108) No. of Companies % No. of Companies % Revenue fromexternal customers 31 82 31 82 Inter-segmentrevenue 26 68 26 68 Segmental result– continuingoperations 32 84 21 55 Segmental result– discontinuedoperations 2 5 1 3 Total assets 36 95 28 74 Total liabilities 35 92 24 63 Capital Expenditure (PPE& intangible Assets) 32 84 17 45 Depreciationand amortisation 35 92 31 82
  32. 32. 25 decreased except the inter-segment revenue as it has noticeably increased from 45% to 68% under IFRS 8 while the rest of the items have decreased. Interestingly, there is no item such as segment result from discontinued operations have disclosed since after one company have included that line under IAS 14. As is observed, the numbers of companies reporting line items such as total assets and liabilities, capital expenditures have dropped by approximately half the number of those companies which reported them in 2008. These current findings are in parallel with those previous findings by (Weissenberger and Franzen, 2012a; Crawford et al. 2012; He et al. 2012; Nicholas et al.2012), who have also resulted a decline in those above line items (See Section 2.6). Figure 3 (continued) Note: This section illustrates the line items included by SGX catalist companies under primary reporting format. 4.2 Items Disclosed per Segment(continued) The complete findings of the SGX 60 companies on line items disclosed under primary segment reporting have presented in beneath table (Section 3). According to overall results the line items disclosed under IAS 14 have decreased in overall when IFRS 8 has superseded IAS 14 except for the only Section2 : Primary/operating segment disclosures SGX Catalist Primary/operating segmentdisclosures(per IAS 14R) Pre IFRS 8 (FRS108) PostIFRS 8 (FRS108) No. of Companies % No. of Companies % Revenue fromexternal customers 18 82 16 73 Inter-segmentrevenue 10 45 15 68 Segmental result– continuingoperations 21 95 12 55 Segmental result– discontinuedoperations 1 5 0 0 Total assets 17 77 9 41 Total liabilities 17 77 10 45 Capital Expenditure (PPE& Intangible Assets) 20 91 13 59 Depreciationand amortisation 19 86 15 68
  33. 33. 26 unique outstanding increase figure of the inter-segment revenue line. Interestingly, this particular line item has included by more of the SGX 60 companies and has a total percentage of 68% companies reporting it in 2010. Undoubtedly, along with other researchers’ findings, the line items which are most effected for overall sample companies are assets, liabilities and capital expenditure. Therefore, according to figure 3 of section 1 to 3, it can be observed that SGX 60 companies have less disclosed the line items which they have included under FRS 14 in 2010. Inter-segment revenue has the outstanding figure as more companies are including it in 2010 while the rest items are either no longer reported or less disclosed. Figure 3 (continued) Note: This section illustrates the line items included by SGX total 60 companies under primary reporting format. 4.2 Items Disclosed per Segment(continued) This figure is the continuous part of segment information statement called secondary reporting. It has been discovered that there is a dramatic drop in disclosing capital expenditure and carrying amount of segment assets according to the data results of SGX 60 companies. Two-third of the companies has excluded those items in their secondary reporting format in 2010 after IAS 14 was replaced, leaving a total companies’ percentage of 20% and 18% Section3 : Primary/operating segment disclosures Total Sample Primary/operating segmentdisclosures(per IAS 14R) Pre IFRS 8 (FRS108) PostIFRS 8 (FRS108) No. of Companies % No. of Companies % Revenue fromexternal customers 49 82 47 78 Inter-segmentrevenue 36 60 41 68 Segmental result– continuingoperations 53 88 33 55 Segmental result– discontinuedoperations 3 5 1 2 Total assets 53 88 37 62 Total liabilities 52 87 34 57 Capital Expenditure (PPE& intangible Assets) 52 87 30 50 Depreciationand amortisation 54 90 46 77
  34. 34. 27 respectively in 2010 (Figure 4 of Section 3). As shown in section 3, 78% of companies have included the item called revenue obtained from external customers. This figure has decreased for sizeable amount when compare to those percentage of companies reporting it under IAS 14 in 2008 (93%). These results are in aligned with the findings of Crawford et al. (2012). Crawford et al. have further stated that the cause in a decline in those line items may impact negatively upon the segment disclosures as less information has been provided for the principals or shareholders. Figure 4 Items disclosed under Secondary Reporting Format Section1: Secondary/entity-wide disclosures SGX Mainboard Pre IFRS 8 (FRS108) PostIFRS 8 (FRS 108) Secondary/entity-wide disclosures(perIAS 14R) No. of Companies % No. of Companies % SegmentRevenue (external revenue) 36 95 32 84 Capital expenditure (locationofassets) 27 71 8 21 Carrying amount of segmentassets 31 82 7 18 Note: This section illustrates the line items included by SGX mainboard companies under secondary reporting format. Note: This section illustrates the line items included by SGX catalist companies under secondary reporting format. Section2: Secondary/entity-wide disclosures SGX Catalist Pre IFRS 8 (FRS108) PostIFRS 8 (FRS108) Secondary/entity-wide disclosures(per IAS 14R) No. of Companies % No. of Companies % SegmentRevenue (external revenue) 20 91 15 68 Capital expenditure (locationofassets) 14 64 4 18 Carrying amount of segmentassets 17 77 4 18
  35. 35. 28 Note: This section illustrates the line items included by SGX total 60 companies under secondary reporting format. 4.3 Average Number of Line Items per Segment This figure has derived from the results which are obtained from the above analysis and findings of the line items disclosed per segment. The disclosure of business segments which is mostly disclosed by primary reporting format as the chosen SGX companies’ business risks and returns are largely based on the products and services they offered to the customers has more number of line items reported than those geographic segments for both years ( 352>145; 269>66). Although the total segment line items by business sectors under both IAS 14 and IFRS 8 have exceeded those disclosed under geographic segments, the line items for business segments have reduced in 2010 when IFRS 8 become active. Therefore, the average number of total line items for business segments under IFRS 8 has reduced to 4.5 from 5.9. Not only the business segments’ line items disclosed are affected but also those reported under geographic segments have decreased dramatically from a total number of 145 to 66, leaving an average number of 1.1 in 2010. Section3 : Secondary/entity-wide disclosures Total Sample Pre IFRS 8 ( FRS 108) PostIFRS 8 ( FRS 108) Secondary/entity-wide disclosures(per IAS 14R) No. of Companies % No. of Companies % SegmentRevenue (external revenue) 56 93 47 78 Capital expenditure (locationofassets) 41 68 12 20 Carrying amount of segmentassets 48 80 11 18
  36. 36. 29 In accordance with the overall measurement results of line items per segments (Figure 3; Figure 4), it has been very clear that SGX companies’ line items have changed negatively as it dropped after IFRS 8 has taken place over IAS 14. Figure 5 Average number of line items per segment Note: This figure shows the total segment line items disclosed under business segments reporting and geographic segments reporting. The average number of line items per segments has also identified. 4.4 Analysis on Chief Operating Decision Maker of SGX 60 From this figure it can be seen that 36 numbers of companies out of 60 have voluntarily included about the information of whom is the person making a decision relating to segment disclosures or who the CODM is. This gives a total percentage of 60 out of 100%. The current study results of SGX 60 companies are parallel to the findings of (Crawford et al. 2012; Kang and Gray, 2012) as more than half of the total companies have given detailed information about the CODM. It has been evidenced that most of the companies’ management team (17%) have the position of CODM, followed by the CEO (7%). This current result is parallel to (Kang and Gary, 2013) whose study is based on 189 Australian listed companies. The rest of the roles such as managing and executive directors, executives committee and board of directors are the least common CODM resulting 3%, 8% and 5% respectively. Noticeably, 40% of SGX 60 companies do not give the specific detail about the CODM. Therefore, in accordance with the CODM identification issues stated earlier in the literature, the SGX listed companies have not been completely clear to the judgement made and thus a chance of being contentious in the future. This could be a reason due to the CODM is not obligatory to identify under IFRS 8 (Crawford et al. 2010). 2008 (IAS 14(FRS 14)) 2010 (IFRS 8 (FRS108)) Business segments Geographic segments Business segments Geographic Segments Total segmentline items disclosed 352 145 269 66 Mean (total segment items/60) 5.9 2.4 4.5 1.1
  37. 37. 30 Figure 5 Chief Operating Decision Maker of SGX 60 Note:Thistable showsthe numberandpercentage of the companiesinrelationtoCODM identification CODM Identification No. of Companies Percentage (%) Identifiedthe CODM 36 60% ManagementTeam 17 28% ChiefExecutive Officer(CEO) 7 12% Managing Directors 2 3% Executive Directors 2 3% ExecutivesCommittee 5 8% Board of Directors 3 5% CODM not stated 24 40% Total companies 60 100%
  38. 38. 31 Chapter 5 Conclusion 5.1 Results Overview Finally, this research paper has accomplished to answer the research questions which are prepared in earlier to evaluate whether the new IFRS 8 has caused changes to the segmental disclosures of Singapore firms. The complete final results as a whole prove that segment disclosures of SGX companies have changed after IFRS 8 (FRS 108) has superseded the old standard IAS 14 (FRS 14). Based on the overall findings, IFRS 8 have impact on the areas such as number of segments and line items per segment. Other amendments or new steps which applied under the principles of the new IFRS 8 are also reasons supporting segment disclosures to be different from the previous former version. For instance, applying the new stage of IFRS 8 such as the management approach has affected those numbers of segments and line items per segments disclosed under Singapore companies’ segmental reporting. Stemming from the management approach, the process with CODM who made decision or managed about the segment reporting has also been judged by numerous forecasters and users as the annual reports in general do not give the detail information on it (Nichols et al. 2012). Along with others research on various sample companies upon the analysis of CODM identification, some of the Singapore selected firms have also not provided about who the CODM is. However, there are also some SGX companies which have voluntarily disclosed the CODM details. 5.2 The CurrentFindingsin Consideration of Previous Literatures and Applied Theory Most of the current findings are in parallel with the previous research findings. However, there are also certain results obtained by SGX 60 companies which are not consistent with those past results. One of the most uncommon findings on SGX companies is about the decrease in the number of segments after the introduction of IFRS 8 as many of the previous studies’ findings on it has increasing results (Crawford et al. 2012; Kang and Gary, 2012; Nichols et al. 2012). Yet, this present findings of decrease in the number of segments by SGX companies are comparable to the previous results obtained from the study on Finnish companies by Saariluoma (2013).
  39. 39. 32 Although the number of business and geographic segments of SGX 60 companies have a declining figures, it was found that the number of total companies which have increased segment figures are more than those companies which have suffered a decrease. The possible reasons behind this is that under IFRS 8 segments are allowed to aggregate each other if they met the segments aggregation requirements (PricewaterhouseCoppers, 2008) and therefore combining two or more segments can result a decline in the number of segments. As a result, literatures have stated that principals or shareholders of segmental reporting will not be able to obtain the complete essential information of the segments operated within the companies they are investing in (ESMA, 2011). From the judgment made from the above reviewed literatures, SGX companies have a slight negative impact by applying the ground-breaking standard IFRS 8 as they disclosed lesser numbers of their operating segments. The next findings to the research question of whether the line items disclosed have changed under IFRS 8 or not have common results with the other research findings. Under IFRS 8, Singapore companies are disclosing lesser line items in both of their business and geographic segment disclosures and this particular finding is in line with findings by (Weissenberger and Franzen, 2012a; Crawford et al. 2012; He et al. 2012; Nichols et al.2012). The line items disclosed for business segment have only decrease in sizeable amount, leaving a difference in the mean number of 1.4. Noticeably, the line items disclosed for geographic segment reporting in 2010 have fallen more than half of those disclosed in 2008 and the most affected line items for Singapore selected firms are capital expenditure, total assets, total liabilities and carrying amount of assets as they dropped dramatically. As is observed from the literatures above, most of the companies reviewed on the paper prepared for the meeting with IASB for post implementation of IFRS 8 has also have a significant decrease in those line items (IASB, 2013) . Last but not least, the findings for whether CODM have identified by the Singapore companies or not is also largely comparable with those research findings which have reviewed in the earlier section. In line with the findings by (Nichols et al. 2012; Kang and Gary, 2012; Crawford et al. 2012), 36 Singapore
  40. 40. 33 companies have also included about who the CODM is and the management team is the most common CODM. To conclude, the overall findings of Singapore companies on the changes on disclosures after IFRS 8 are mostly comparable with the results from the previous studies by numerous authors except for the findings on number of segments. 5.3 The CurrentFindingsin Consideration of Previous Literatures and Applied Theory According to the agency theory, the segmental reporting is a useful and essential tool for a better relationship between the shareholders and the managers who control the business. However, as mentioned earlier in section 2.2, the whole idea of management cannot be fully in line with the principals or shareholders’ idea. Therefore, the findings of SGX companies adopting the management approach and applying the CODM step as mandatory under the principle of IFRS 8 could be a potential issue for principal-agent relationship as they cannot be always agreed on the idea and plan of each other (Meek, Roberts & Gray, 1995). However, as the idea of accounting disclosure have been derived from the agency theory and therefore all the Singapore companies have disclosed their Segment related information which will allow the users to know the nature of the companies they are investing in, the segmental disclosure regardless of using the IAS 14 or IFRS 8 will be an essential disclosure for both users and preparers (Meek, Roberts & Gray, 1995). . 5.3 Limitations and Future Research From the targeted findings presented, this present particular research area of segmental reporting on SGX companies can be further explored in the future. Although, most of the previous researches on IFRS 8 segmental reporting have done on approximately 100-250 companies (Crawford et al. 2012; H. Mardini, 2012 etc.), the sample size for this current research are relatively smaller than those past studies for some provided limitations in earlier section (Section 3.4). Therefore, future research is required to examine on more firms including those companies which are incorporated within other countries as long as they disclosed their segmental reporting under IFRS 8 or FRS 108. In this way, the results on the number of segments could also have similar outcomes to other past studies like (Crawford et al. 2012) which have examined
  41. 41. 34 on 100 companies. In addition, although this study have analysed on the changes on features of segmental reporting after IFRS 8 has taken place, it has omitted from analysing on whether the segment reporting are related to the characteristics of entity. Moreover, as the current findings are not based on the individual opinion within the related firms such as preparers and users and hence further research could be also analysed by using qualitative method which results are based on surveys. From this research option, how the Singapore users and preparers of annual reports have personally thought about on the new standard, IFRS 8 can be measured. Last but not least, the reason of why the SGX companies have chosen to change the standard in accordance with the IFRS will be also an interesting area to consider in the future. In conclusion, there are many further abundant research options available in relation to the changes on segment disclosures after IFRS 8.
  42. 42. 35 References AASB,. (2013). IFRS 8 Post-implementation Review: Reflecting on the IASB Report and Feedback Statement. Retrieved from http://www.aasb.gov.au/admin/file/content102/c3/M133_7.2_Reflecting_on_IASB_ IFRS8_RFS.pdf Altaf, N. (2014). Impact Of Segment Reporting On Stock Market Performance. Journal Of Business Management & Social Sciences Research, 3(6), 64-70. Aleksanyana, M., & Danboltb, J. (2015). Segment Reporting: Is IFRS 8 Really Better?. Forthcoming In Accounting In Europe, A Journal Of The European Accounting Association.. doi:http://dx.doi.org/10.2139/ssrn.2180894 Berger, P., & Hann, R. (2003). The Impact of SFAS No. 131 on Information and Monitoring. Journal Of Accounting Research, 41(2), 163-223. doi:10.1111/1475- 679x.00100 Bugeja, M., Czernkowski, R., & Moran, D. (2012, August). Did IFRS 8 Increase Segment Disclosure?. Crawford, L., Extance, H., Helliar, C., & Power, D. (2012). Operating segments: The usefulness of IFRS 8. Edinburgh: ICAS. Retrieved from http://icas.org.uk/crawford.pdf Crawford, L., Ferguson, J., Helliar, C., & Power, D. (2014). Control over accounting standards within the European Union: The political controversy surrounding the adoption of IFRS 8. Critical Perspectives On Accounting, 25(4-5), 304-318. doi:10.1016/j.cpa.2013.03.001 Crawford, L., Helliar, C., & Power, D. (2010). Politics or Accounting Principles: Why was IFRS 8 so controversial?. ICAEW. Crawford, L., Helliar, C., & Power, D. (n.d.). IFRS8: Stakeholder perceptions of the introduction of a controversial standard. Retrieved from http://www.stir.ac.uk/media/schools/management/documents/accountingfinance/eufi n2010/EUFIN%20-%20Crawford%20-%20Helliar%20-%20Power.pdf Douma, S. W., & Schreuder, H. (2008). Economic approaches to organizations. Pearson Education.
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  45. 45. 38 convergence-standard-on-segment-reporting.aspx IFRS,. (2013). Post-implementation Review: IFRS 8 Operating Segments. Retrieved from http://www.ifrs.org/Current-Projects/IASB-Projects/PIR/IFRS- 8/Documents/PIR-IFRS-8-Operating-Segments-July-2013.pdf In Proceedings of the American Accounting Association Annual Meeting, Washington (pp. 4-8). Jensen, M. C., & Meckling, W. H. (1994). Self-interest, altruism, incentives, and agency theory. Journal of applied corporate finance, 7(2), 40-45. Jermakowicz, E., & Gornik-Tomaszewski, S. (2006). Implementing IFRS from the perspective of EU publicly traded companies. Journal Of International Accounting, Auditing And Taxation, 15(2), 170-196. doi:10.1016/j.intaccaudtax.2006.08.003 Kang, H., & Gray, S. J. (2013). Segment reporting practices in Australia: Has IFRS 8 made a difference?. Australian Accounting Review, 23(3), 232-243. Kang, H., & Gray, S. J. (2013). Segment reporting practices in Australia: Has IFRS 8 made a difference?. Australian Accounting Review, 23(3), 232-243. Kajuter, P., & Nienhaus, M. (2012). Value relevance of segment reporting— Evidence from German companies. Working paper, University of Munster. Kpmg,. (2010). The Application of IFRS: Segment Reporting. Retrieved from https://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/ILine-of- Business-publications/Documents/The-Application-of-IFRS-Segment-reporting- Executive-Summary-16-july-2010.pdf Mardini, G. H. (2012). The impact of IFRS 8 on segmental reporting by Jordanian Listed Companies. Retrieved from http://discovery.dundee.ac.uk/portal/files/1253086/mardini_phd_2012.pdf Mardini, G. H., Crawford, L., & Power, D. M. (2012). The impact of IFRS 8 on disclosure practices of Jordanian listed companies. Journal of Accounting in Emerging Economies, 2(1), 67-90. Mardini, G., Crawford, L., & Power, D. (2012). The impact of IFRS 8 on disclosure practices of Jordanian listed companies. J Acc In Emerging Economies, 2(1), 67-90. doi:10.1108/20421161211196139
  46. 46. 39 mca.gov,. (2013). Accounting Standard (AS) 17: Segment Reporting. Retrieved from http://www.mca.gov.in/Ministry/notification/pdf/AS_17.pdf McKinnon, J., & Dalimunthe, L. (1993). Voluntary Disclosure of Segment Information by Australian Diversified Companies. Accounting & Finance, 33(1), 33-50. doi:10.1111/j.1467-629x.1993.tb00192.x Moldovan, R. (2014). Post-Implementation Reviews for IASB and FASB Standards: A Comparison of the Process and Findings for the Operating Segments Standards. Accounting In Europe, 11(1), 113-137. doi:10.1080/17449480.2014.901588 Meek, G. K., Roberts, C. B., & Gray, S. J. (1995). Factors influencing voluntary annual report disclosures by US, UK and continental European multinational corporations. Journal of international business studies, 555-572. Nichols, N. B., Street, D. L., & Cereola, S. J. (2012). An analysis of the impact of adopting IFRS 8 on the segment disclosures of European blue chip companies. Journal of International Accounting, Auditing and Taxation, 21(2), 79-105. Nichols, N., & Street, D. (2007). The relationship between competition and business segment reporting decisions under the management approach of IAS 14 Revised. Journal Of International Accounting, Auditing And Taxation, 16(1), 51-68. doi:10.1016/j.intaccaudtax.2007.01.002 Nichols, N., Street, D., & Cereola, S. (2012). An analysis of the impact of adopting IFRS 8 on the segment disclosures of European blue chip companies. Journal of International Accounting, Auditing and Taxation, 21(2), 79-105. doi:10.1016/j.intaccaudtax.2012.07.001 Nichols, N., Street, D., & Tarca, A. (2013). The Impact of Segment Reporting Under the IFRS 8 and SFAS 131 Management Approach: A Research Review. J Int Financ Manage Account, 24(3), 261-312. doi:10.1111/jifm.12012 Parker, C., & Sauer, D. (2009). Understanding Segment Information, Vol. 80(11). Retrieved from http://connection.ebscohost.com/c/articles/47154098/understanding- segment-information PricewaterhouseCoopers,. (2008). A practical guide to segment reporting. Retrieved from http://www.pwc.com/gx/en/ifrs-reporting/pdf/segment-reporting.pdf PricewaterhouseCoopers. (2012). A Practical Guide to New Singapore Financial
  47. 47. 40 Reporting Standards for 2012. From PwC: http://www.pwc.com/sg/en/illustrative- annual-report-2012/assets/iar_practical_guide_2012.pdf PricewaterhouseCoopers. (2014, October). IFRS adoption by Country. From PwC: www.pwc.com/en_US/us/issues/ifrs-reporting/publications/assets/pwc-ifrs-by- country-2014.pdf Pisano, S., & Landriani, L. (2012). The determinants of segment disclosure: an empirical analysis on Italian listed companies. Financial Reporting. PwC. (2012). A Practical Guide to New Singapore Financial Reporting Standards for 2012. From PwC : http://www.pwc.com/sg/en/illustrative-annual-report- 2012/assets/iar_practical_guide_2012.pdf Prather-Kinsey, J., & Meek, G. K. (2004). The effect of revised IAS 14 on segment reporting by IAS companies. European Accounting Review, 13(2), 213-234. PricewaterhouseCoopers,. (2008). Singapore Financial Reporting Standards. Retrieved from http://www.pwc.com/sg/en/illustrative-annual-report- 2008/assets/pocketguide200808.pdf PricewaterhouseCoopers. (2008, September). A practical guide to Segment Reporting . From pwc: http://www.pwc.com/gx/en/ifrs-reporting/pdf/segment- reporting.pdf Quinn, D. and Jones, T. (1995). AN AGENT MORALITY VIEW OF BUSINESS POLICY. Academy of Management Review, 20(1), pp.22-42. Rennie, E., & Emmanuel, C. (1992). Segmental Disclosure Practice: Thirteen Years On. Accounting And Business Research, 22(86), 151-159. doi:10.1080/00014788.1992.9729430 Roberts, C. B. (2010). Segment reporting. Comparative International Accounting. From http://ebooks.narotama.ac.id/files/Comparative%20International%20Accounting%2 0(10th%20Edition)/Chapter%2019%20%20Segment%20Reporting.pdf Sagepub,. (2007). Evaluating Information: Validity, Reliability, Accuracy, Triangulation. Retrieved from http://www.sagepub.com/upm- data/17810_5052_Pierce_Ch07.pdf
  48. 48. 41 Street, D. L., Nichols, N. B., & Gray, S. J. (2000). Segment disclosures under SFAS No. 131: Has business segment reporting improved?. Accounting Horizons, 14(3), 259-285. Sgx.com,. (2015). Singapore Exchange Ltd | SGX. Retrieved 14 April 2015, from http://www.sgx.com/ Singapore Statutes Online,. (n.d.). Singapore Statutes Online - 50 - Companies Act. Retrieved 16 April 2015, from http://statutes.agc.gov.sg/ Singapore Corporate Awards . (2014). Best Annual Report . From Singapore Corporate Awards : http://www.scawards.com.sg/scawards_ar.html Saariluoma, S. (2013). The Effects of IFRS 8 on Segment Disclosure - Evidence from Finnish Listed Companies. Retrieved from http://epub.lib.aalto.fi/en/ethesis/pdf/13471/hse_ethesis_13471.pdf Sukhraj (2007a), ‘A standard that nobody likes’, Accountancy Age, April p7. Tarca, A., & Pitman, A. (2013). Post-implementation review of IFRS 8. Retrieved from http://www.ifrs.org/IFRS-Research/Research- impact/Documents/6B%20Post%20implementation%20review.pdf UNIT, S. (2009, July). Adoption of IFRS by Central Government briefing note by the House of Commons Scrutiny Unit. From Parliment: www.parliament.uk/documents/upload/IFRSbriefing.pdf Valenza, P., & Heem, G. (2012). An Analysis of Segment Disclosures Under IAS 14 and IFRS 8. SSRN Journal. doi:10.2139/ssrn.1615430 Veron, N. (2007). EU Adoption of the IFRS 8 standard on operating segments. Note for the ECON Committee of the European Parliament. Wilkins, T., & Khoo, E. (2012). IFRS Segment Disclosures and Internal Capital Market Efficiency: Is There Any Improvement?. Working paper (National University of Singapore, Singapore, 2012). Walliman, N. (2004). Your undergraduate dissertation. London: SAGE. Weissenberger, B., & Franzen, N. (2012). The Impact of IFRS 8 on Segment Reporting in Germany: Have New Rules Overstepped the Mark?. Working paper
  49. 49. 42 (Justus-Liebig-University Giessen, Giessen, Germany, 2012a)
  50. 50. 43 Reflective statement As this dissertation is my very first one that I have ever written, the whole tasks have been very challenging for me but yet I have gained a lot of experience and knowledge through the process. Therefore, I believe this piece of work will still be lacking in some of the areas though I have tried my best. As I have chosen the specific area that I am personally interested in- which is the Segmental reporting of Singapore companies, the whole procedures have really kept me with great interests. However, there are also some challenging parts for me like Literature reviews and the data analysing. As the literature reviews needs a huge amount of knowledge by reading numerous articles in order to compare and critically produce statements of understanding, I personally found it tough. But the basic knowledge that I have learnt from the advice of my supervisor, Wendy and ESAP language class have equipped me with a better capability to get the work to be done. Next, the data collecting and analysing is a challenging part as I am practically testing on my research questions. Due to my inexperience, I made several mistakes in collecting and analysing my data at first and I had to encourage myself many times till I got the correct results. Therefore, it needed quite a large amount of time for me to accomplish. From this part, I have studied the nature of segmental disclosures from 174 total of different annual reports listed on SGX in two separate years. Despite the time consuming and some difficulties I have experienced, I am really thankful to have this opportunity to analyse the data and do research on my own interests area. Because to be a good accountant, I believe that one would have to be very familiar with the annual reports in real world. I believe that from this dissertation, I have gained a lot knowledge which I can apply in the future of my career. Overall, despite all the difficulties I finally have accomplished with the very kind help of my supervisor and I am very pleased with my piece of hard work.
  51. 51. 44 Acronyms AASB – Australian Accounting Standards Board CODM – Chief Operating Decision Maker ED – Exposure Draft ESMA – European Securities and Market Authority IAS – International Accounting Standards IASC – International Accounting Standards Committee IFRS – International Financial Reporting Standards IASB – International Accounting Standards Board SFRS – Singapore Financial Reporting Standards SSAP – Statements of Standard Accounting Practice SGX – Singapore Stock Exchange
  52. 52. 45 Appendices Appendix 1 SAMPLE COMPANIES SGX MAINBOARD SGX CATALIST ASL MARINE HOLDINGS LTD. AA group holdingsltd FIRST RESOURCES LIMITED ASIATRAVEL.COM HOLDINGS LTD QAF LIMITED SELECT GROUP LIMITED LOW KENG HUAT (SINGAPORE) LIMITED HOSEN GROUP LTD. (DISCONTINUED) CHINA SUNSINE CHEMICAL HOLDINGS LTD. ADVANCED SYSTEMS AUTOMATION LIMITED ADDVALUE TECHNOLOGIES LTD COLEX HOLDINGS LIMITED ALLIED TECHNOLOGIES LIMITED EMS ENERGY LIMITED ABR HOLDINGS LIMITED SITRA HOLDINGS (INTERNATIONAL) LIMITED ABTERRA LTD (Dis) CRAFT PRINT INTERNATIONAL LIMITED. ACHIEVA LIMITED (Dis) FUJI OFFSET PLATES MANUFACTURING LTD ADVANCED INTEGRATED MANUFACTURING CORP. LTD. ALBEDO LIMITED AMARA HOLDINGS LIMITED INTERNATIONAL PRESS SOFTCOM LIMITED SINGAPORE AIRLINES LIMITED ITE ELECTRIC COMPANY LTD ANNAIK LIMITED MEGACHEM LIMITED VICOM LTD PROGEN HOLDINGS LTD BBR HOLDINGS (S) LTD SOON LIAN HOLDINGS LIMITED ASIA ENTERPRISES HOLDING LIMITED TSH CORPORATION LIMITED YHI INTERNATIONAL LIMITED TMC EDUCATION CORPORATION LTD. WILMAR INTERNATIONAL LIMITED VASHION GROUP LTD. VENTURE CORPORATION LIMITED ADVENTUS HOLDINGS LIMITED UNITED ENVIROTECH LTD. KLW HOLDINGS LIMITED TYE SOON LIMITED LINAIR TECHNOLOGIES LIMITED TECKWAH INDUSTRIAL CORPORATION LTD STAMFORD TYRES CORPORATION LIMITED STAMFORD LAND CORPORATION LTD SOUTHERN PACKAGING GROUP LIMITED SINGAPORE PRESS HOLDINGS LIMITED SERIAL SYSTEM LTD CWT LIMITED CHIP ENG SENG CORPORATION LTD. ENGRO CORPORATION LIMITED HOTEL ROYAL LIMITED RIVERSTONE HOLDINGS LIMITED CHEMICAL INDUSTRIES (FAR EAST) LIMITED. DYNAMIC COLOURS LIMITED PETRA FOODS LIMITED PNE INDUSTRIES LTD HOTEL PROPERTIES LIMITED
  53. 53. 46 Appendix 2 Faculty of Business and Law StudentResearch EthicalIssues Form Student Name: JA HTU AUNG Programme of Study BA (HONS) ACCOUNTING Title of Research Project: IFRS 8 (Operating Segments) Start Date of Research Project: 25 October 2014 Supervisor WENDY MASON BURDON Comments Brief description of the proposed research methods including (if relevant) how human participants will be selected and involved. Quantitative data will be collected from Singapore companies which are listed on Singapore stock exchange. Data are available through the companies’ annual reports. No human participants will be involved.
  54. 54. 47 How will informed consent of research participants be acquired? (If appropriate attach draft informed consent form) N/A Research will be formed through collecting data which are available through annual reports on the internet. Will the research involve an organization(s)? (If appropriate attach draft organisational consent form) No How will research data be collected, securely stored and anonymity protected (where this is required) Research will be formed through collecting data which are available through annual reports on the internet. How will data be destroyed after the end of the project? (Where data is not to be destroyed please give reasons) N/A Any other ethical issues anticipated? No Student Signature (indicating that the research will be conducted in conformity with the above and agreeing that any significant change in the research project will be notified and a further “Project Amendment’ Form submitted). Date: ………………………………Student Signature:……………………………………………. Supervisor: I confirm that I have read this form and I believe the proposed research will not breach University policies. Date:……………………………… Signature:………………………………………….
  55. 55. 48 Please Note: The appropriate completion of this form is a critical component of the University Policy on Ethical Issues in Research and Consultancy. If further advice is required, please contact the Faculty Research Ethics Committee through bl.ethics.administrator@northumbria.ac.uk in the first instance.

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