Page 2 - 25. COMPILER QB - IND AS 108

INDAS 108 –

OPERATING SEGMENTS

(TOTAL NO. OF QUESTIONS – 8)

INDEX
S.No. Particulars Page No.

1 RTP Questions 25.1
2 MTP Questions 25.3

3 Past Exam Questions 25.6

RTPs QUESTIONS

Q1 (May 19)

An entity uses the weighted average cost formula to assign costs to inventories and cost of goods sold for
financial reporting purposes, but the reports provided to the chief operating decision maker use the First-In,
First-Out (FIFO) method for evaluating the performance of segment operations. Which cost formula should be
used for Ind AS 108 disclosure purposes?

SOLUTION
The entity should use the First-In, First-Out (FIFO) method for its Ind AS 108 disclosures, even though it
uses the weighted average cost formula for measuring inventories for inclusion in its financial statements.
Where the chief operating decision maker uses only one measure of segment asset, the same measure should

be used to report segment information. Accordingly, in the given case, the method used in preparing the
financial information for the chief operating decision maker should be used for reporting under Ind AS 108.
However, reconciliation between the segment results and results as per financial statements needs to be given
by the entity in its segment report.

Q2 (May 20)
ABC Limited has 5 operating segments namely A, B, C, D and E. The profit/ loss of respective segments for
the year ended March 31, 20X1 are as follows:

Segment Profit/(Loss) (Rs in crore)
A 780
B 1,500
C (2,300)
D (4,500)
E 6,000
Total 1,480
25. 1