Q1 March Newsletter - bdo singapore

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Continued...... Step Five – Secure The Deal Lastly, it is very important to address the specific negotiation issues at hand for each distributor based on the initial terms and conditions offered during the correspondence process. This is often dependent on the bargaining power of the respective parties. An important, though often overlooked tip is to fully appreciate the cultural and social aspect, and the mode of operations of these distributors while being able to provide them their needs when brokering a deal. This in turn enhances your company’s chances of obtaining the best possible outcome during the negotiation process itself. To sum up, actively engaging the five major steps above allows a business to expedite the process of securing an ideal overseas distributor in a systematic manner and achieve its long-term overseas expansion plan. How BDO Raffles can help The Management Consulting division of BDO Raffles helps clients by identifying and securing suitable business opportunities and partners to successfully gain market entry in overseas markets. Currently, it is helping a number of companies ranging from the retail, leisure and lifestyle and F&B industries to secure overseas partners in both Asia and Europe. Should you like to find out more about how we can help you in your internationalistion efforts, please do not hesitate to contact our Management Consulting Division at weehan@<strong>bdo</strong>.com.sg Article contributed by: Leo Kah Mun Manager Management Consulting Services DID: 68289603 kahmun@<strong>bdo</strong>.com.sg Are you ready for FRS 108 Operating Segments? A number of new or revised financial reporting standards have been issued in recent years which will take effect for annual periods beginning on or after 1 January 2009 and they may or may not have implications on your company’s accounts. One of them relates to FRS 108 Operating Segments which will supersede FRS 14 Segment Reporting. FRS 108 aims to present more relevant information to users by mirroring information used internally by chief operating decision makers to manage segments to those disclosed in the financial statements. Consequently, FRS 108 provides more flexibility in disclosure requirements. Consistent with FRS 14, FRS 108 is applicable to entities whose equity or debt securities are publicly traded and those that file, or are in the process of filing, their financial statements with a securities commission or other regulatory organisation for the purpose of issuing any class of instruments in a public market. Similarly, only consolidated segment information is presented when both the separate and consolidated financial statements of the parent company are presented in a single financial report. Contrary to FRS 14 which requires the identification of primary and secondary segments based on the definitions given, FRS 108 adopts the “management approach” by requiring the entity to disclose segment information based on components of the business that management uses to make decisions about operating segments. In addition to the differing approach undertaken, FRS 108 also differs from FRS 14 in other requirements including the following:
Continued...... Are you ready for FRS 108 Operating Segments? FRS 108 FRS 14 Identification of segment Considers that a component of an entity that sells primarily or exclusively to other operating segments of the entity meets the definition of an operating segment if the entity is managed in that manner. Measurement of segment information Disclosures Specified Items Gives more discretion in defining segment information, limited only by an entity’s internal reporting practice. The entity is required to provide an explanation of bases used and perform reconciliation between the segment information on an aggregate basis (of all reportable segments) to the amounts reported in the financial statements. Requires the disclosure of specified amounts about each reportable segment, if the specified amounts are included in the measurement of segment profit or loss or are otherwise regularly provided to the chief operating decision maker (“CODM”), even if not included in that measure of profit or loss. Interest Income and Expense Requires the disclosure of interest income separately from interest expense for each reportable segment unless a majority of the segment’s revenue are from interest and the CODM relies primarily on net interest revenue to assess the performance of the segment and to make decisions about resources to be allocated to the segment. General information Requires the disclosure of the entity’s products and services, geographical areas and major customers, regardless of the entity’s organisation, if the information is not included as part of the disclosures about segments. Such entity-wide disclosures are required even when the entity has only one reportable segment. Limits reportable segments to those that earn a majority (>50%) of their revenue from sales to external parties and does not require the different stages of a verticallyintegrated entity to be identified as separate segments. Requires segment information to be prepared using the accounting principles adopted for the financial statements of the entity. Segment information is therefore an analysis of the entity’s information disclosed in the financial statements.
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Q1 March Newsletter - bdo singapore

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