Yakub02
Banned
Discontinued operation IFRS 5 Non-current assets held for sale and discontinued operations sets out requirements for disclosure of financial information relating to discontinued operations. The reason for requiring disclosure of information about discontinued operations is as follows:
Closing down some operations will affect the future financial prospects of the entity.
It is therefore appropriate that users of the financial statements should be provided with relevant information about the discontinuation. This will help them to make a more reliable prediction of the future performance of the entity.
This information can be produced by providing information about discontinued operations separately from information about continuing operations.
A discontinued operation is a disposal group that satisfies extra criteria. (IFRS 5 does not say as much but this is a helpful way to think of it).
Discontinued operation - A component of an entity that either has been disposed of or is classified as held for sale and:
1. represents a separate major line of business or geographical area of operations,
2. is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations or 3. is a subsidiary acquired exclusively with a view to resale.
Closing down some operations will affect the future financial prospects of the entity.
It is therefore appropriate that users of the financial statements should be provided with relevant information about the discontinuation. This will help them to make a more reliable prediction of the future performance of the entity.
This information can be produced by providing information about discontinued operations separately from information about continuing operations.
A discontinued operation is a disposal group that satisfies extra criteria. (IFRS 5 does not say as much but this is a helpful way to think of it).
Discontinued operation - A component of an entity that either has been disposed of or is classified as held for sale and:
1. represents a separate major line of business or geographical area of operations,
2. is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations or 3. is a subsidiary acquired exclusively with a view to resale.
