Other Segment Items

The Board affirmed the decision to require that a public entity disclose an amount and qualitative description for other segment items for each reportable segment. The Board also affirmed the decision to require that a public entity disclose the nature of the segment expense information that the CODM uses to manage operations if the entity does not disclose expenses under the principle for one or more of its reportable segments.

Corporate Overhead by Segment

The Board decided to include implementation guidance in the final Update to clarify that the principle applies to allocated overhead expenses by segment.

Decision That There Is No Reconciliation Requirement

The Board affirmed that a public entity is not required to disclose a reconciliation of the total of the reportable segment’s amount for each significant expense category to its corresponding consolidated expense amount.

Other Matters Related to the Principle

The Board affirmed the following decisions:

1. Require that a public entity disclose interest expense for a financial operation segment when that item represents a significant expense in accordance with the principle
2. Retain all existing segment disclosure requirements of both Topic 280 and other GAAP Topics
3. Require that a public entity disclose significant expense categories and amounts that are easily computable from the management reports that are regularly provided to the CODM and include implementation guidance on the easily computable concept.

Single Reportable Segment Entities

The Board affirmed the following decisions:

1. The current and proposed segment disclosure requirements apply to all public entities, including those public entities that have a single reportable segment.
2. Include implementation guidance on the disclosed measure of profit or loss for a public entity reporting as a single reportable segment entity.

The Board also decided that the final Update will:

1. Include implementation guidance on the concept of assessing performance for a public entity with a single reportable segment
2. Include an illustrative example of the disclosures for a public entity reporting as a single reportable segment entity
3. Include a discussion about cases for which applying the disclosure requirements could result in duplicating information from the primary financial statements within the segment footnote.

Certain Public Entities within the Scope of Topic 280

The Board decided not to make changes to the scope of public entities that apply Topic 280.

Disclosure of Multiple Measures of a Segment’s Profit or Loss

The Board affirmed the following decisions: 

1. Allow a public entity to report multiple measures of a segment’s profit or loss that are used by the CODM to allocate resources and assess performance
2. Require that the total of the reportable segments’ amount for each measure of segment profit or loss be reconciled in accordance with paragraph 280-10-50-30(d)
3. Require that the existing and proposed segment disclosures apply to each reported measure of a segment’s profit or loss
4. Not to extend these requirements to other measures that a CODM uses, such as segment assets.

The Board also decided that the final Update will:

1. Include an illustrative example of a public entity that discloses multiple measures of a segment’s profit or loss
2. Require that when a public entity discloses additional measures of a segment’s profit or loss, it should disclose those measures for the prior periods in which those measures were regularly provided to the CODM
3. Require that a public entity disclose an explanation of how the CODM uses each reported measure of a segment’s profit or loss to allocate resources and assess performance
4. Emphasize that a public entity may not disclose a measure of a segment’s profit or loss that is not utilized by the CODM for purposes of allocating resources and assessing performance.

Interim Disclosure Requirements

The Board affirmed the decision that the principle and all existing segment disclosure requirements for a reportable segment’s profit or loss and assets are required to be disclosed on an interim and annual basis. The Board emphasized that a public entity is required to provide a reconciliation of segment profit or loss to the consolidated income statement on an interim basis. The Board affirmed that no additional reconciliations would be required on an interim basis.

Recasting of Prior-Period Segment Information to Conform to Current-Period Segment Information

The Board affirmed the following decisions:

1. Change the terminology from restatement to recast throughout Topic 280
2. Require that a public entity recast segment expense categories and amounts in prior periods when there is a change in the composition of reportable segments in the current period, unless impracticable
3. Not to require that a public entity recast segment expense categories and amounts as a result of changes in measurement methods, but state that it is preferable to do so
4. Require that a public entity recast the significant segment expense categories and amounts in prior periods when the entity changes its internal reports and the segment expense information that is regularly provided to the CODM in the current period, unless impracticable
5. Include discussion in the basis for conclusions for recasting of prior-period information when a segment expense meets or no longer meets significance.

The Board also decided to require both the new and old significant segment expense categories when recasting is impracticable.

Disclosure of Significant Changes in Allocating Expenses to Segments

The Board affirmed the decision to require that a public entity explain the nature of significant changes from prior periods in the expense allocation methods and expense measurement methods used to determine segment profit or loss.

Disclosure of Title and Position of the CODM

The Board affirmed the decision to require that a public entity disclose the title and position of its CODM.

Transition

The Board affirmed the decision to require that a public entity apply the amendments on a retrospective basis, unless impracticable.

Transition Disclosure

The Board decided to not affirm the proposed transition disclosure in the final Update about certain changes to the segment expenses included in the management reports that are regularly provided to the CODM.

Effective Date and Early Adoption

The Board decided the amendments will be effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Board also decided that early adoption is permitted.

Analysis of Costs and Benefits

The Board concluded that it has received sufficient information and analysis to make an informed decision on the expected costs and expected benefits of the amendments and that the expected benefits of the amendments would justify the expected costs. The Board directed the staff to draft a final Update for vote by written ballot.