Aggregation of segments is allowed only if the 75% test is satisfied.

Question

Quizplus · Accepted Answer

Aggregation of segments is allowed under certain conditions in financial reporting and tax compliance, but the 75% test specifically refers to a rule in U.S. tax code for Real Estate Investment Trusts (REITs), which requires at least 75% of a REIT's income to come from certain real estate sources. The concept of segment aggregation in financial reporting (e.g., under IFRS 8 or ASC 280 for operating segments) involves criteria such as similarity in economic characteristics, nature of products and services, and production processes, rather than a percentage-based test.

Aggregation of Segments Is Allowed Only If the 75% Test