loss, they would not need to be disclosed. However, the Standard does not prohibit
their disclosure.
Siemens includes measures of new orders and free cash flow in its segment information
as shown in Extract 32.5 below.
Extract 32.5: Siemens AG (2017)
B.6 Notes to Consolidated Financial Statements [extract]
NOTE 28 Segment information [extract]
Orders1
Free
cash
flow
Fiscal year
Fiscal year
(in millions of €)
2017
2016
2017
2016
Power and Gas
13,422
19,454
392
1,149
Energy Management
13,628
12,963
1,002
375
Building Technologies
6,913
6,435
820
598
Mobility
8,963
7,875
1,046
497
Digital Factory
11,532
10,332
1,963
1,771
Process Industries and Drives
9,034
8,939
373
618
Healthineers
14,218
13,830
2,153
2,154
Siemens Gamesa Renewable Energy
8,768
7,973
(279)
330
Industrial Business
86,477
87,802
7,471
7,493
Financial Services (SFS)
921
979
734
680
Reconciliation to Consolidated Financial
Statements
(1,730)
(2,300)
(3,386)
(2,640)
Siemens (continuing operations)
85,669
86,480
4,819
5,533
1
This supplemental information on Orders is provided on a voluntary basis. It is not part of the Consolidated Financial
Statements subject to the audit opinion.
2872 Chapter 32
5.3
Disclosure of other elements of revenue, income and expense
The following items should also be disclosed about each reportable segment if the
specified amounts are included in the measure of segment profit or loss reviewed by the
chief operating decision maker or are otherwise regularly provided in respect of those
segments to the chief operating decision maker (even if not included in that measure of
segment profit or loss):
(a) revenues from external customers;
(b) revenues from transactions with other operating segments of the same entity;
(c) interest
revenue;
(d) interest
expense;
(e) depreciation
and
amortisation;
(f) material items of income and expense disclosed in accordance with paragraph 97
of IAS 1 – Presentation of Financial Statements;
(g) the entity’s interest in the profit or loss of associates and joint ventures accounted
for by the equity method;
(h) income tax expense or income; and
(i) material non-cash items other than depreciation and amortisation. [IFRS 8.23].
Interest revenue should be reported separately from interest expense for each
reportable segment unless a majority of the segment’s revenues are from interest and
the chief operating decision maker relies primarily on net interest revenue to assess the
performance of the segment and make decisions on the allocation of resources to it. In
that case, the entity can report net interest revenue or expense for the segment provided
that it discloses it has done so. [IFRS 8.23].
Where the measure of segment profit or loss is determined after deducting depreciation
and amortisation, these amounts will have to be disclosed separately for purposes of
segment reporting, even if they are not separately reported to the CODM.
It can be seen that whilst IFRS 8 indicates the line items of income or expense or other
information that might merit disclosure by segment, what an entity actually reports in
its financial statements is determined by the line items used by the chief operating
decision maker to define segment profit or loss and segment assets or liabilities, together
with the other information otherwise regularly provided to the chief operating decision
maker. [IFRS 8.23-24]. This means that different entities (even those with very similar
activities) will make different disclosures, depending on what information is provided
to the chief operating decision maker. Indeed, what is disclosed by one entity for each
of its reportable segments might vary because, for example, the result of one segment is
determined after deducting interest whilst that of other segments is drawn before
interest; or because the information provided to the chief operating decision maker
about one segment includes equity-accounted associates but for other segments does
not. As such the disclosures made by an entity are tailored according to exactly what
appears in the information presented to the chief operating decision maker.
Statoil provides segment disclosures based on its internal management reporting, with
reportable segments determined based on differences in the nature of their operations,
products and services, as follows:
Operating
segments
2873
Extract 32.6: Statoil ASA (2017)
Consolidated financial statements and notes [extract]
3 Segments [extract]
Segment data for the years ended 31 December 2017, 2016 and 2015 are presented below [extract]
E&P
E&P
MMP
Other
Elimin-
(in USD million)
Norway
International
ations Total
Full year 2017
Revenues third party and
other income
(23)
1,984
58,935
102
0
60,999
Revenues inter-segment1)
17,586
7,249
83
1
(24,919)
0
Net income/ (loss) from
equity accounted investments
129
22 53
(16)
0
188
Total revenues and other income
17,692
9,256
59,071
87
(24,919)
61,187
Purchases [net of inventory
variation]1)
0
(7) (52,647) (0)
24,442
(28,212)
Operating, selling, general
and administrative expenses1)
(2,954)
(2,804)
(3,925)
(235)
418
(9,501)
Depreciation, amortisation
and net impairment losses
(3,874)
(4,423) (256)
(91)
(0)
(8,644)
Exploration expenses
(3
79)
(681)
0
0
0
(1,059)
Net operating income/(loss)
10,485
1,341
2,243
(239)
(59)
13,771
Additions to PP&E,
4,869
5,063
320
543
0
10,795
intangibles and equity
accounted investments
Balance sheet information
Equity accounted investments
1,133
234
134
1,050
0
2,551
Non-current segment assets
30,278
36,453
5,137
390
0
72,258
Non-current assets, not
allocated to segments
9,102
Total non-current assets
83,911
1) Parts of the gas transportation costs that previously were allocated to MMP and therefore deducted from the
inter segment transfer price, are from 1 January 2017 allocated to E&P Norway.
5.4
Additional disclosures relating to segment assets
If any of the following items are either included in the measure of segment assets
reviewed by the chief operating decision maker or otherwise regularly provided in
respect of those segments (whether included in segment assets or not), an entity should
also disclose for each segment:
(a) the investment in equity-accounted associates and joint ventures; and
(b) total expenditures for additions to non-current assets other than financial
instruments, deferred tax assets, post-employment benefit assets and rights arising
under insurance contracts. [IFRS 8.24].
2874 Chapter 32
5.5
Explanation of the measurements used in segment reporting
As noted at 4 above, instead of prescribing how an entity should calculate the amounts
reported in its segmental disclosures, IFRS 8 requires an entity to explain how its
measures of segment profit or loss, segment assets and segment liabilities have been
determined. As a minimum, the following information is required:
(a) the basis of accounting for any transactions between reportable segments;
(b) if not apparent from the required reconciliations (see 5.6 below), the nature of any
differences between the measurement of total reported segment profit or loss and
the entity’s profit or loss before income taxes and discontinued operations;
(c) the nature of any differences between the measurements of total reported segment
assets and the entity’s assets, if not apparent from the required reconciliations;
(d) the nature of any differences between the measurements of total reported segment
liabilities and the entity’s liabilities, if not apparent from the required reconciliations;
(e) the nature of any changes from prior periods in the measurement methods used to
determine segment profit or loss, including the financial effect, if any, of those
changes; and
(f) the nature and effect of any asymmetrical allocations to reportable segments, such
as where depreciation is included in segment profit but the related property, plant
and equipment is not included in segment assets. [IFRS 8.27].
The kind of disclosures in (b), (c) and (d) above that are necessary for an understanding
of the reported segment information could relate to the accounting policies used,
including policies for the allocation of centrally incurred costs in arriving at segment
profit or loss and for the allocation of jointly used assets and liabilities in determining
segment assets and segment liabilities. [IFRS 8.27]. Other examples might include the use
of previous local GAAP numbers, where internal reporting does not reflect the entity’s
move to IFRS, or the use of budgeted figures, for example when applying budgeted or
constant foreign currency rates.
In Extract 32.7 below, Daimler confirms that segment information is prepared using the same
accounting policies as the IFRS financial statements, describes how ‘EBIT’ is the measure of
segment profit or loss and explains how segment assets and liabilities are determined.
Extract 32.7: Daimler AG (2017)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS [extract]
33.
Segment reporting [extract]
Management and reporting system
The Group’s management reporting and controlling systems principally use accounting policies that are the same as
those described in Note 1 in the summary of significant accounting policies according to IFRS.
The Group measures the performance of its operating segments through a measure of segment profit or loss which is
referred to as “EBIT” in our management and reporting system.
EBIT comprises gross profit, selling and general administrative expenses, research and non-capitalized development
costs, other operating income/expense, and our share of profit/loss from equity-method investments, net, as well as
other financial income/expense, net. Although amortization of capitalized borrowing costs is included in cost of sales,
it is not included in EBIT.
Operating
segments
2875
Intersegment revenue is generally recorded at values that approximate third-party selling prices.
Segment assets principally comprise all assets. The vehicle segments’ assets exclude income tax assets, assets from
defined benefit pension plans and other post-employment benefit plans, and certain financial assets (including
liquidity). Segment liabilities principally comprise all liabilities. The vehicle segments’ liabilities exclude income tax liabilities, liabilities from defined benefit pension plans and other post-employment benefit plans, and certain financial liabilities (including financing liabilities).
Daimler Financial Services’ performance is measured on the basis of return on equity, which is the usual procedure in
the banking business.
The residual value risks associated with the Group’s operating leases and finance lease receivables are generally borne
by the vehicle segments that manufactured the leased equipment. Risk sharing is based on agreements between the
respective vehicle segments and Daimler Financial Services; the terms vary by vehicle segment and geographic region.
Non-current assets consist of intangible assets, property, plant and equipment and equipment on operating leases.
Capital expenditures for intangible assets and property, plant and equipment reflect the cash-effective additions to
these intangible assets and property, plant and equipment as far as they do not relate to capitalized borrowing costs,
goodwill or finance leases.
Depreciation and amortization may also include impairments as far as they do not relate to goodwill impairment
pursuant to IAS 36.
Amortization of capitalized borrowing costs is not included in the amortization of intangible assets or depreciation of
property, plant and equipment since it is not considered as part of EBIT.
In its 2017 financial statements, HOCHTIEF provided an explanation of the basis of
accounting for transactions between reportable segments.
Extract 32.8: HOCHTIEF Aktiengesellschaft (2017)
Notes to the Consolidated Financial Statements [extract]
36.
Segment reporting [extract]
HOCHTIEF’s structure reflects the operating focus of our business as well as the Group’s presence in key national
and international regions and markets. Segmental reporting in the HOCHTIEF Group is based on the Group’s
divisional operations. The breakdown mirrors the Group’s internal reporting systems.
The Group’s reportable segments (divisions) are as follows:
HOCHTIEF Americas encompasses the construction activities of operational units in the USA and Canada
HOCHTIEF Asia Pacific pools the construction activities and contract mining in the Asia-Pacific region
HOCHTIEF Europe brings together the core business in Europe as well as selected other regions and designs, develops,
builds, operates, and manages real estate and infrastructure.
Corporate comprises Corporate Headquarters, other activities not assignable to the separately listed divisions,
including management of financial resources and insurance activities, plus consolidation effects. Insurance activities
are managed from Corporate Headquarters under the responsibility of HOCHTIEF Insurance Broking and Risk
Management Solutions GmbH with various companies in Luxembourg, including Builders Reinsurance S.A. The
HOCHTIEF insurance companies primarily provide mainly reinsurance offerings for contractors’ casualty and surety,
subcontractor default, liability, and occupational accident insurance.
Explanatory notes to the segmental data [extract]
Intersegment sales represent revenue generated between divisions. They are transacted on an arm’s length basis.
External sales mainly comprise revenue recognized using the percentage of completion method in the mainstream
construction business, construction management, and contract mining. The sum of external sales and intersegment
sales adds up to total sales revenue for each division.
2876 Chapter 32
5.6 Reconciliations
International GAAP® 2019: Generally Accepted Accounting Practice under International Financial Reporting Standards Page 572
