When is a support function a segment?

Segment reporting

The Public Sector Accounting Forum (PSAF) noted uncertainty in practice about when support functions are reported as segments. They may be seen to meet the definition of a segment as a result of how entities prepare and report on their budgets. However, GRAP 18 on Segment Reporting includes an example of a support function that does not meet the definition.

The PSAF considered the following:

• The objective of GRAP 18 indicates that segment information should be useful to
• Management reviewing financial information from an internal control perspective would not automatically meet the definition of a segment.

Each entity should consider its circumstances and policies to determine which units meet the definition of a segment.