Identifying reportable segments

Identifying Reportable Segments
Primary and Secondary Segment Reporting Formats
19. The 
dominant source and nature of risks and returns of an enterprise
should govern whether its primary segment reporting format will be business
segments or geographical segments. If the risks and returns of an enterprise
are affected predominantly by differences in the products and services it
produces, its primary format for reporting segment information
should be business segments, with secondary information reported
geographically. Similarly, if the risks and returns of the enterprise are

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Segment Reporting
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by the fact that it operates in different countries or other geographical
areas, its primary format for reporting segment information should be 
geographical segments, with secondary information reported for groups
of related products and services.
20. Internal organisation and management structure of an enterprise
and its system of internal financial reporting to the board of directors and
the chief executive officer should normally be the basis for identifying the
predominant source and nature of risks and differing rates of return facing
the enterprise and, therefore, for determining which reporting format is
primary and which is secondary, except as provided in sub-paragraphs
(a) and (b) below:
(a) if risks and returns of an enterprise are strongly affected both by
differences in the products and services it produces and by
differences in the geographical areas in which it operates, as