8/13/2019 Discontinued Operation and Interim Reporting

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DISCONTINUED OPERATIONS

Key Definitions

Discontinued Operation - Is a component of anentity that either has been disposed of or isclassified as held for sale, and;

a. Represents a separate major line ofbusiness or geographical area ofoperations,

b. Is part of a single co-ordinated plan todispose of a separate major line ofbusiness or geographical area ofoperations, or

c. Is a subsidiary acquired exclusively witha view to resale.

Component of an Entity – Operations and cashflows that can be clearly distinguished,operationally and for financial reporting

purposes, from the rest of the entity.

Presentation of Discontinued Operations

• As a sing e amount on t!e face of t!eincome statement comprising t!e totaof"

a. he sum of the post-tax profit or loss ofthe discontinued operation; and

b. he post-tax gain or loss recogni!ed on

the measurement to fair value less costto sell or on the disposal of the assetsor disposal group"s# constituting thediscontinued operation.

• In t!e notes or on t!e face

of t!e income statements – $n analysis ofthe sing e amount as presented aboveinto%

a. he revenue, expenses and pre-tax

profit or loss of discontinued operations;

b. he related income tax expense

c. he gain or loss recogni!ed on themeasurement to fair value less costs tosell or on the disposal of the assetsconstituting the discontinued operation;and

d. he related income tax expense.

• Cas! f o# statement

presentation $ he net cash flowsattributable to the operating, investing, andfinancing activities of a discontinuedoperation shall be separately presented onthe face of the cash flow statement ordisclosed in the notes.

INTERI% REPORTIN&

Key Definitions

Interim Period & Is a financial reporting periodshorter than a full financial year.

Interim financia report & $ financial reportcontaining either a complete set of financialstatements or a set of condensed financialstatements for an interim period'

%inimum Components of an Interim (inanciaReport

a' Condensed )a ance s!eet)' Condensed income statementc' Condensed statement s!o#ing eit!er

*i+ a c!anges in e,uity or *ii+ c!angesin e,uity ot!er t!an t!ose arising fromcapita transactions #it! o#ners anddistri)utions to o#ners

d' Condensed cas! f o# statement- and

e' Se ected e.p anatory notes

&enera &uide ines of Interim (inanciaReporting

a. Revenues from products sold or servicesrendered are generally recogni!ed forinterim reports on the same )asis as fort!e annua period'

b. 'xpenses associated direct y #it!re/enue are matched against revenue inthose interim periods in which the related

revenue is recogni!ed.

c. 'xpenses not associated with revenueare recogni!ed in t!e interim periods asincurred or a ocated over the interimperiods benefited.

d. Inventories are measured for interimfinancial reporting by the same principlesas at financial year-end. (owever fullinventory ta)ing may not be required atinterim dates although it must be done atfinancial year-end. It may be sufficient toma)e estimates at interim dates basedon sales margin.

e. Inventory losses from permanentmar0et dec ines are recogni!ed in theinterim period in which the declineoccurs. Recoveries of such losses onthe same inventory in later interim periodshould be recogni!ed as gains in laterinterim periods.

f. emporary mar)et declines oninventories and recoveries at a laterinterim period are no# recogni1ed forinterim purposes.

g. Interim period income tax expenseshould reflect the same generalprinciples of income tax accountingapplicable to annual reporting.

h. *ains or losses from, disposal ofproperty, gains or losses from sale of

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8/13/2019 Discontinued Operation and Interim Reporting

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discontinued operations and other gainsand losses s!ou d not )e a ocatedover the interim periods.

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