Caprion Ltd is a diversified entity that operates four different divisions. The four divisions are in Windhoek, and each division reports separately to the board of directors of Caprion Ltd. The board evaluates the performance of the four divisions and allocates resources accordingly. As a result of the reporting line to the board of directors, financial information for each division is available. The activities of the divisions are as follows:

Division A: A farming division supplying wood (currently this division supplies wood exclusively to the paper mill (Division B) and the timber outlet Division D ), but an external market for wood exists

Division: B A paper mill

Division C: A group of stationery outlets

Division D: A timber outlet

Headquarters: H.Q. The Headquarters do the administration and accounting work; headquarters is a cost center and is evaluated based on budgeted targets rather than profit.

The following information is also available for the divisions:

Division A Division B Division C Division D Headquarters

N$ N$ N$ N$

Consolidated revenue:

External customers 15 000 60 000 30 000 6 000

Inter-segment sales 7 500 - 18 000 9 000 -

Caprion Ltd includes all sales for internal accounting purposes.

Required

3.1 Applying IFRS 8 guidelines identify operating segments. (Please motivate your answer). 10Marks

3.2 Applying IFRS 8: Operating segments, what are reportable segments and using an appropriate Quantitative threshold applicable to this question, which of the above segments are reportable segments?