CAF-6 · Chapter 6 · Question 14 of 15
In identifying its segments, Zenith Ltd has 12 operating segments. Management believes that showing 12 segments would be too detailed for users. Does IFRS 8 provide a suggested limit?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) A practical limit of around 10 segments.
Explanation
IFRS 8 states that if the number of reportable segments exceeds 10, the entity should consider whether a practical limit has been reached.
More IFRS 8 Operating Segments MCQs
- Q1According to IFRS 8, which of the following is an 'Operating Segment'?
- Q2What is meant by the 'Chief Operating Decision Maker' (CODM) in IFRS 8?
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- Q4In addition to the revenue test, a segment is reportable if the absolute amount of its reported profit or loss is 10% or more of the…
- Q5If the total external revenue reported by reportable segments constitutes less than what percentage of the entity's total revenue…