The PwC global network of firms submitted comments on the IFRS Interpretations Committee’s tentative agenda item regarding the presentation of intragroup transactions between continuing and discontinued operations. We believe that the agenda decision goes beyond clarifying or explaining the requirements of IFRS 5, Non-current Assets Held for Sale and Discontinued Operations. Instead, it will establish a single rule for applying a presentation standard without adequate due process. This may well lead to key figures in the income statement and earnings per share that are misleading and do not provide decision useful information. We agree with the Committee’s view that the requirement in IFRS 10 to eliminate intra-group transactions in full is applicable, and that this applies in situations where a portion of the group is classified and presented separately as a discontinued operation.
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