Background

The objective of the overall convergence project is to eliminate a variety of differences between International Financial Reporting Standards and US GAAP. The project, which is being done jointly by FASB and IASB, grew out of an agreement reached by the two boards in September 2002.

As part of the project, the IASB identified differences between IAS 14 Segment Reporting and SFAS 131 Disclosures about Segments of an Enterprise and Related Information, reviewed academic research findings on segment reporting, in particular relating to the implementation of SFAS 131, and had meetings with users of financial statements.

The requirements of SFAS 131 are based on the way that the management regards an entity, focusing on information about the components of the business that management uses to make decisions about operating matters. In contrast, IAS 14 requires the disaggregation of the entity’s financial statements into segments based on related products and services, and on geographical areas.

Current status of the project

This project has been completed. The IASB issued IFRS 8 Operating Segments on 30 November 2006.

Project milestones