In its annual financial statements for the year ended 31 March 2020, Verge, a public limited company, had identified the following operating segments:

(i) Segment 1 local train

(ii) Segment 2 inter-city train

(iii) Segment 3 railway

The company has disclosed two reported components. Phases 1 and 2 are grouped into one reportable segment. Active segments 1 and 2 are grouped together on the basis of their common business characteristics, as well as the type of products and services they offer. In the local railway market, it is the local transport authority that rewards the contract and pays Verge for its services. At the local railway market, contracts are awarded following a competitive bidding process, and passenger prices are set and paid by the transportation authority. In the inter-city train market, prices are set by Verge and passengers pay Verge for the service provided.

Refer the above information:

Advise Verge on how the above accounting issues should be dealt with in its financial statements according to IFRS-8 Segment Reporting.

Answer rating: 100% (QA)

There is one additional condition that must be met similar economic characteristics For example in t... View the full answer