Disclosure of segment information is useful in the analysis of diversified companies.

Question

Quizplus · Accepted Answer

Diversified companies often operate in multiple industries, businesses or product lines, and segment information helps to understand the performance of each segment. By analyzing the revenue, profitability, growth, and other metrics of each segment separately, investors and analysts can assess the strengths and weaknesses, risks and opportunities of the company's portfolio and strategy. Segment information can also provide insights into the contribution of each segment to the overall financial results, the allocation of resources, and the potential for synergies or conflicts among the segments. Overall, disclosure of segment information enhances the transparency, comparability, and confidence in the company's financial reporting.

Disclosure of Segment Information Is Useful in the Analysis of Diversified