ASSIGNMENT SUBMISSION SHEET
BSC (Hons) in Accounting and Finance
Module Title: CORPORATE REPORTING
1. LEE KEE TAR, UB: 11034518
2. JULIANA BTE ABDUL RAHMAN, UB: 11034517
3. VITHIA SUBRAMANIAM, UB: 11034521
4. ANG MING LIANG, UB: 12038344
SEGMENT DISCLOSURE ARE WIDELY REGARDED AS SOME OF THE MOST USEFUL DISCLOSURE IN FINANCIAL REPORTS BECAUSE OF THE EXTENT TO WHICH THEY DISAGGREGATE FINANCIAL IMFORMATION INTO MEANINGFUL AND OFTEN REVEALING GROUPS.DISCUSS
Word Count: 2554
Lecturer: MR LIM KAIM SOON
Batch number: BAFE1 1232A
SUBMISSION DATE: 24th NOVEMBER 2014
TABLE OF CONTENT
Discuss the objectives of segmental information in annual reports
Discuss the requirements for the disclosure of segmental information in annual reports
Based on the extracts from the segment notes, how much & what segmental information is provided in the segment notes?
Discuss whether the companies are in compliance With the relevant accounting standards?
Discuss the similarities and differences between their disclosure practice
What the segmental disclosures indicate about the relative performance of the segments within each of those companies?
What factors could potentially help to explain the differences/similarities in the segmental disclosure practices of the selected companies?
Comment on whether the information is useful and sufficient to allow shareholders to make informed investment decisions.
Discuss the implications of your analysis and findings, such as policy implications.
This report is to provide an overview of segmental disclosure in the financial statements of companies. The growth of large and diversified companies has presented difficulties for users of financial reports in the assessment of its performance and cashflow as well as the risks and hence segmental disclosure provide some certainty in meeting the information requirements of the investors. Many companies are not willing to disclose segment information as there could be insufficient information and lack of resources to provide adequate segmental information as it incurs high cost in preparing segmental information. Another consideration why companies are unwilling to disclose segments is that they may experience competitive disadvantages. Regulators have been pushing for companies to disclose segmental information as there is a lack of voluntary disclosures where senior management chooses discretion in segmental disclosures. This could result in potential misleading and distorted information. Segmental disclosure reporting has provided better information for analyst and researchers with forecasting on business performances. There is evidence that segment information accuracy on forecast is dependent on specific industries and the size of the companies as well. It also appears that geographical segmental disclosure have more useful data for market reaction and for the management to make decisions on operating matters.
1a) Discuss the objectives of segmental information in annual reports Segment reporting remains to be an important aspect of reporting of financial statement. It allows the users to make sound judgment of the opportunities and risks facing an entity by the disclosure of more disaggregated information than those provided in the primary financial statements. As the segmental information to be disclosed is more disaggregated, it allows the users of the financial statement to analyse the financial performance of the organization in the different areas or segments where they operate. Therefore, segmental reporting data increase the value relevance of the accounting information disclosed in the financial statements. 1b) Discuss the...
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