For-profit Entities: Proposed improvements to IFRS 8 Operating Segments

The International Accounting Standards Board (IASB) is proposing amendments to IFRS 8 Operating Segments. The proposals are set out in IASB ED/2017/2 Improvements to IFRS 8 Operating Segments (Proposed amendments to IFRS 8 and IAS 34).

Due to the limited scope of NZ IFRS 8 Operating Segments, the proposals will be mainly relevant to Tier 1 for-profit entities.

We would like to know your views about the proposals in the Exposure Draft.

The proposed amendments follow on from a Post‑implementation Review of IFRS 8 that was carried out by the IASB to assess whether the Standard works as intended.

The proposed improvements in the Exposure Draft include amendments:

  • to clarify and emphasise the criteria that must be met before two operating segments may be aggregated;
  • to require entities to disclose the title and role of the person or group that performs the function of the chief operating decision maker; and
  • to require entities to provide information in the notes to the financial statements if segments in the financial statements differ from segments reported elsewhere in the financial report and accompanying materials.

The IASB is also proposing to amend IAS 34 Interim Financial Reporting to require companies that change their segments to provide restated segment information for prior interim periods earlier than they currently do.

We are committed to adopting international standards, while also ensuring those standards reflect our New Zealand conditions. This ensures we remain internationally competitive.

Once the IASB issues the final amendments, we will issue equivalent amendments in New Zealand for those for-profit entities that apply NZ IFRS. Therefore, this exposure draft is your opportunity to comment on the proposals. A separate consultation will be undertaken in respect of any proposed disclosure concessions for Tier 2 for-profit entities.

Comments can be in an email or letter and can be formal or informal. 

Comments are due to the NZASB by 17 June 2017 and to the IASB by 31 July 2017.

Further information is available from the XRB website