5.1 Overview
In addition to disclosures about each reportable segment, which are discussed in
Chapter 4 and Chapter 6, ASC 280 requires
entity-wide disclosures about the following regardless of how the entity is
organized:
-
Products and services (see Section 5.4).
-
Geographical areas (see Section 5.5).
-
Major customers (see Section 5.7).
ASC 280-10
05-5 To provide some comparability between public entities, this Subtopic requires that an entity report certain
information about the revenues that it derives from each of its products and services (or groups of similar
products and services) and about the countries in which it earns revenues and holds assets, regardless of how
the entity is organized. As a consequence, some entities are likely to be required to provide limited information
that may not be used for making operating decisions and assessing performance.
50-38 Paragraphs 280-10-50-40
through 50-42 apply to all public entities subject to this
Subtopic including those public entities that have a single
reportable segment. Some public entities’ business
activities are not organized on the basis of differences in
related products and services or differences in geographic
areas of operations. That is, a public entity’s segments may
report revenues from a broad range of essentially different
products and services, or more than one of its reportable
segments may provide essentially the same products and
services. Similarly, a public entity’s segments may hold
assets in different geographic areas and report revenues
from customers in different geographic areas, or more than
one of its segments may operate in the same geographic area.
Information required by paragraphs 280-10-50-40 through
50-42 need be provided only if it is not provided as part of
the reportable operating segment information required by
this Subtopic.
50-39 Entity-wide disclosures
are required only for annual reporting.
Entity-wide disclosure requirements apply to every entity that is subject to ASC
280, irrespective of the number of identified operating segments or the basis on
which the entity is organized for resource allocation and performance assessment
purposes, as noted in paragraph 101 of the Background Information and Basis for
Conclusions of FASB Statement 131. However, an entity would not have to repeat the
disclosures if they are otherwise provided. For example, if an entity’s operating
segments are based on products and services, and revenue for each product or service
(or group of similar products and services) is disclosed in the reportable segments
disclosure, this information need not be repeated in the entity-wide
disclosures.
However, if an entity manages its business on the basis of geographic regions and determines its
reportable segments accordingly, it still must provide separate geographic disclosures for each country
in which revenues are material. Some entities provide this disclosure by presenting material countries
separately from subtotals by region. See further discussion in Section 5.5.1.
Key Takeaways
- Entity-wide disclosures are intended to ensure some level of comparability across entities, regardless of how these entities are managed or resources are allocated. Accordingly, an entity should carefully consider the objectives and principles of ASC 280 when evaluating the disclosure requirements.
- Disclosure of information about products and services will be particularly important when an entity has identified a single operating segment.
5.1.1 Annual Presentation
While an entity is only required to include entity-wide disclosures in its
annual reporting, nothing would preclude it from voluntarily providing such
information on an interim basis.