Statement on auditing standards, 021

              American Institute of
Certified Public Accountants
Segment Information 1
1. Statement of Financial Accounting Standards No. 14, Fi­nancial
Reporting for Segments of a Business Enterprise, requires
the inclusion of certain information about an entity's operations in
different industries, its foreign operations and export sales, and its
major customers ( referred to in this Statement as " segment informa­tion")
in annual financial statements that are intended to present
financial position, results of operations, and changes in financial
position in conformity with generally accepted accounting principles.
Disclosure of segment information requires the disaggregation of
certain significant elements of an entity's financial statements, such
as revenue, operating profit or loss, identifiable assets, depreciation,
and capital expenditures. This Statement provides guidance to an
auditor in examining and reporting on financial statements that are
required to include segment information in conformity with FASB
Statement No. 14.
2. Segment information is one of the disclosures required by
generally accepted accounting principles as an integral part of
financial statements. The purpose of segment information is stated
in paragraph 5 of FASB Statement No. 14:
The purpose of the information required to be reported by this
Statement is to assist financial statement users in analyzing and
understanding the enterprise's financial statements by permitting
better assessment of the enterprise's past performance and future
prospects. . . . information prepared in conformity with this State-
1 The meaning of the term " segment information" in this Statement differs from
that of the term " segment" in footnote 2 of SAS No. 14, Special Reports.
Copyright © 1977 by the
American Institute of Certified Public Accountants, Inc.
1211 Avenue of the Americas, New York, N. Y. 10036
Statement on
Auditing Standards
Issued by the Auditing Standards Executive Committee
December 1977
21
AICPA