Why this is mistaken
First identify operating segments from business activity, discrete information, and regular CODM review. Then evaluate permitted aggregation, quantitative tests, coverage, consistency, additional information, and reconciliation.
Where to watch
When this mistake may appear
- A component is below a ten-percent test.
- Management wants fewer reported segments.
Check your work
Your work may contain this mistake if:
- Deletes small components before identifying operating segments.
- Aggregates solely to pass or avoid a threshold.
- Skips external-revenue coverage and consolidated reconciliation.