Corporate Financial Reporting · Operating Segments (Ind AS 108)
Restatement of Segment Information under Ind AS 108
Updated 11 October 2026 · Fact-checked
When an entity reorganises internally so that its reportable segments change, Ind AS 108 requires earlier-period segment information to be restated to the new structure. The exception is where the information is not available and the cost to develop it would be excessive, judged item by item. If not restated, give current-year data on both old and new bases.
Understand Restatement of Segments and Practical Problems
Segment information is built from how management runs the business. The chief operating decision maker reviews operating segments, and the reportable segments follow that internal structure. So if management reorganises, the reportable segments can change.
A change in segments breaks comparability. If this year's figures are on a new basis and last year's are on the old basis, a reader cannot see the trend. This is why the standard asks for restatement of the corresponding information for earlier periods, including interim periods.
The relief is narrow. You need not restate if the information is not available and the cost to develop it would be excessive. This test is applied for each individual item of disclosure, not for the whole set. You may therefore restate segment revenue but not segment assets, if assets cannot be re-split without excessive cost.
If you do not restate, there is a fallback. In the year of change, disclose current-period segment information on both the old basis and the new basis, again unless the data is not available and the cost would be excessive. In every case of a change in composition, disclose whether you have restated the earlier-period items.
A change in segments caused by reorganisation is different from a change in measurement method. A change in how segment profit is measured is covered by the measurement disclosures, which require the nature of the change and its effect, if any, on segment profit or loss.
On Ind AS 108 vs AS 17: AS 17 used primary and secondary segment formats (business and geographical) based on risks and returns. Ind AS 108 uses the management approach: segments follow internal reporting to the chief operating decision maker, and measures are those used internally. Learn this contrast as it is commonly asked.
Key rules to remember
- Restatement rule (para 29)
- Composition of reportable segments changes → restate earlier periods (incl. interim) unless information not available AND cost to develop it excessive
- Both conditions must hold for the exemption. The test is made for each individual item of disclosure.
- Fallback if not restated (para 30)
- No restatement → disclose current period on old basis AND new basis (unless not available and excessive cost)
- Required in the year in which the change occurs.
- Disclosure of restatement
- State whether corresponding items of earlier periods have been restated
- Required after any change in composition of reportable segments.
- Major customer test (para 34)
- Revenue from a single external customer ≥ 10% of entity's revenue → disclose
- Disclose the fact, total revenue from each such customer and the segment(s) reporting it. Customer identity need not be disclosed. Entities under common control count as one customer.
- Practical limit on segments (para 19)
- Reportable segments above ten → consider whether a practical limit is reached
- No precise limit is set. It is a point to consider, not a hard cap.
How to solve Restatement of Segments and Practical Problems questions
Use this order for any restatement or practical question on Ind AS 108.
- 1Read the facts and decide whether internal organisation changed in a way that changes the composition of reportable segments. A mere change in segment names or in measurement is a different issue.
- 2If composition changed, state the general rule: restate earlier periods, including interim periods, to the new structure.
- 3Check the exemption item by item. Ask if the data is not available and the cost to develop it is excessive. Both must be true for that item.
- 4Do the numbers: regroup the old segment figures into the new segments for each comparative period and each item (revenue, result, assets, liabilities).
- 5If an item cannot be restated, give current-year data on both old and new bases for it.
- 6Add the required disclosure: whether comparatives have been restated.
- 7Where figures are asked, check the reconciliation: segment totals must tie to entity totals, and the 10% thresholds and major customer test must be applied to the right base.
- 8Close with a one-line conclusion that answers what the question asked.
Quickest way: Restate or dual-basis in four checks
When to use it: Use for short MCQs and for the theory part of a case-based question.
- Did the segment composition change? If no, nothing to restate.
- Is the data available or cheap to build? If yes, restate.
- If not, give current year on old and new basis.
- Always state whether you restated.
Common mistakes in Restatement of Segments and Practical Problems
Applying the not-available exemption to all segment information together
Students read it as one blanket relief.
Fix: The standard says the determination is made for each individual item of disclosure. Restate what you can.
Saying restatement is needed for any change, including a change in measurement method
Restatement and measurement changes are mixed up.
Fix: Restatement under this rule is triggered by a change in the composition of reportable segments. Measurement changes need disclosure of nature and effect, if any.
Forgetting the dual-basis disclosure when comparatives are not restated
Students stop at saying no restatement.
Fix: Current-period data on both old and new bases is required unless the data is unavailable and costly.
Writing that Ind AS 108 uses risks and returns with primary and secondary formats
That is the AS 17 approach and is carried over.
Fix: Ind AS 108 follows the management approach based on internal reporting to the chief operating decision maker.
Disclosing the major customer's name and amount per segment as mandatory
Students over-read the 10% rule.
Fix: Disclose the fact, total revenue from each such customer and the segment(s). Identity and per-segment amounts need not be disclosed.
Treating the limit of ten segments as a hard cap
The number sticks as a rule.
Fix: Above ten, the entity only considers whether a practical limit has been reached. No precise limit is set.
Worked examples
Example 1
Bharat Industries Ltd reorganised on 1 April 2026. Earlier it reported two segments, Consumer and Industrial. The CODM now reviews three segments: Consumer, Industrial Machinery and Industrial Chemicals. For 2025-26, Industrial segment revenue was ₹600 crore, of which Machinery was ₹380 crore and Chemicals ₹220 crore. Segment assets of Industrial were ₹900 crore and cannot be split without excessive cost. Explain the treatment of 2025-26 comparatives.
Show the solution
- The reorganisation changes the composition of reportable segments, so earlier periods must be restated unless the information is unavailable and costly.
- Test item by item. Revenue split is available: Machinery ₹380 crore and Chemicals ₹220 crore, total ₹600 crore, which agrees to the old Industrial figure.
- Segment assets cannot be split without excessive cost, so the exemption applies to that item only.
- For segment assets, comparatives are not restated. In the year of change, disclose current-year segment assets on both old basis (two segments) and new basis (three segments).
- Disclose that revenue comparatives have been restated and assets have not.
Answer: Restate 2025-26 revenue as Machinery ₹380 crore and Chemicals ₹220 crore. Do not restate segment assets, but give current-year assets on both old and new bases, and disclose which items were restated.
Example 2
Kaveri Textiles Ltd has total revenue of ₹500 crore. Sales to Reliable Retail Ltd are ₹46 crore, and to its two wholly owned subsidiaries under common control ₹9 crore and ₹7 crore. All are reported in the Domestic segment. Is any major customer disclosure required?
Show the solution
- Entities known to be under common control are treated as a single customer. Reliable Retail and its two subsidiaries, if all under its common control, are one customer.
- Revenue from the group is ₹46 crore + ₹9 crore + ₹7 crore = ₹62 crore.
- 10% of total revenue is ₹500 crore × 10% = ₹50 crore.
- ₹62 crore is above ₹50 crore, so the 10% test is met. Reliable Retail alone at ₹46 crore would not meet it, so the grouping matters.
- Disclose the fact of reliance, the total ₹62 crore, and that it is reported in the Domestic segment. The customer's name need not be disclosed.
Answer: Yes. The common-control group is one customer with revenue of ₹62 crore, which exceeds 10% (₹50 crore). Disclose the fact, ₹62 crore and the Domestic segment. The identity need not be disclosed.
Exam tips
- Quote the two-part exemption exactly: information not available and cost excessive, tested for each item.
- For AS 17 vs Ind AS 108 questions, write a pairwise contrast: risks and returns with primary and secondary formats versus the management approach with internal reporting.
- In numerical questions on restatement, show the regrouping and tie the new segments back to the old total.
- Always add the closing disclosure line on whether comparatives are restated.
Practice questions from Operating Segments (Ind AS 108)
- Which statement correctly describes how the scope of Ind AS 108 differs from IFRS 8 as set out in the comparison with IFRS 8?
- Kaveri Pharma Ltd is a company whose shares are not listed. It prepares Ind AS financial statements and asks whether Ind AS 108 itself decid…
- Ind AS 108 describes the chief operating decision maker (CODM) of an entity. Which statement is consistent with the Standard?
- Sagar Foods Ltd reports internally to its board in two ways: by product line (snacks, beverages, dairy), each with a segment manager, and by…
- Gangotri Industries Ltd has a corporate headquarters that houses the finance, legal and HR functions. The headquarters earns no revenue exce…
Restatement of Segments and Practical Problems in other exams
The same ground in other exams, if you are preparing for more than one or want another angle on it.
Restatement of Segments and Practical Problems: frequently asked questions
When must comparative segment information be restated under Ind AS 108?
When the entity changes its internal organisation so that the composition of its reportable segments changes. Earlier periods, including interim periods, are restated unless the information is not available and the cost to develop it would be excessive.
What if the entity does not restate the earlier periods?
In the year of change it must disclose current-period segment information on both the old and new bases of segmentation. This is again subject to the data being available without excessive cost.
What is the main difference between Ind AS 108 and AS 17?
AS 17 identified primary and secondary segments using risks and returns. Ind AS 108 uses the management approach, where segments and measures follow what the chief operating decision maker reviews internally.
Is the excessive-cost exemption applied to the whole segment note?
No. The determination is made for each individual item of disclosure. You may restate some items and not others.