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Important Stuff on Ind AS 108, Operating Segments

Indian Accounting Standard (Ind AS) 108, Operating Segments, Important Material

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Ind AS 108: Operating Segments

In today’s global economy, most entities produce and market a variety of products and services and also operate in many geographical areas of the world. Each of the products and geographical areas are naturally subject to different rates of profitability, risks and opportunities and so on. It is therefore to be aware of the risks and return involved in each geographical area and for each product /service. This information will enable to make appropriate decisions regarding the utilization of the entity’s resources.

This Ind AS deals with providing segment information and to establish principles for reporting financial information by segment. This information will enable the users of the financial statements to:

  • Understand the entity’s past performance
  • Assess the entity’s risk and return
  • Make more informed decision


Basic objective of Ind AS-108 is that an entity should disclose information to enable users of its financial statements to evaluate the financial effects of the types of business activities in which it is engaged and the economic environments in which it operates.


This Accounting Standard shall apply to companies to which Indian Accounting Standards (Ind ASs) notified under the Companies Act apply.

If an entity that is not required to apply this Ind AS chooses to disclose information about segments that does not comply with this Ind AS, it shall not describe the information as segment information.

If a financial report contains both the consolidated financial statements of a parent that is within the scope of this Ind AS as well as the parent’s separate financial statements, segment information is required only in the consolidated financial statements.


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