UNIVERSITY OF CAPE COAST

COLLEGE OF HUMANITIES AND LEGAL STUDIES

SCHOOL OF BUSINESS
DEPARTMENT OF ACCOUNTING
ADVANCED FINANCIAL REPORTING
IFRS 8-REVIEW QUESTIONS
Question 1
Jayna Ltd is preparing is operating segment disclosure note for the first time following its listing on the local
stock exchange during the year. Its chief operating decision maker (CODM) regularly reviews the results of
its three separate divisions:
• Domestic Travels Operations
• International Travels Operations
• Road Construction
Jayna Ltd is intending to report two operating segments in its disclosure note as opposed to the three
reviewed by the CODM. The domestic and international operations are to be combined because it is felt that
they have similar economic characteristics due to the services that they offer.
The domestic operations involve a competitive tender process to run the railway service, which is then
awarded by the local transport authority. The local transport authority then sets the ticket prices and collects
the fares which are then distributed amongst the various operators running the contracts.
The international operations’ ticket prices are set by Jayna Ltd, who collects the fares from the passengers
directly.
Required: Advise Jayna Ltd as to whether the proposed combination of the two operating segments
is appropriate.
Question 2
You have been provided with the following information from the books of Habibi Ltd for five divisions of
operation:

Divisions Profit (GH¢m) Loss GH¢m)

1 200
2 500
3 800
4 700
5 800
2,200 800

Required: Which of the divisions are reportable segments under IFRS 8 Operating segments?

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Question 3
An entity has identified the following business components

Components Revenue-Ext (GH¢) Revenue-Inter(GH¢)

Profit (GH¢) Assets GH¢)
1 160,000 - 20,000 100,000
2 - 90,000 10,000 60,000
3 20,000 - 2,000 8,000
4 16,000 - 1,000 6,000
Total 196,000 90,000 33,000 174,000

Required: Which of the segments would be reportable under the criteria identified in IFRS 8?
Question 4
You are provided the following information on Mawunyo Ltd with six operating segments for the year to 31 December
2020:

Operating External Internal Profit/

Assets
Segments Revenue Revenue (loss)
GH¢ '000
A - 48,000 (3,600) 10,800
B 368,000 16,000 (24,000) 96,000
C 44,000 9,000 38,000 9,000
D 48,000 - (46,400) 12,000
E 46,000 - 4,600 13,000
F 50,000 6,000 5,800 36,000
Total 556,000 79,000 (25,600) 176,800

Required:
For each of the segment, indicate whether it is reportable or not and explain the basis of your answer.

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