Assessing a specified main business activity

Learning objectives

• Assess whether an entity has a specified main business activity on the basis of supporting evidence.L3

Normative references

• IFRS 18 §49To classify its income and expenses into the operating, investing and financing categories, the entity assesses whether it has a specified main business activity: investing in particular types of assets or providing financing to customers; an entity may have more than one main business activity, and the assessment, based on evidence, follows application guidance B30 to B41.

Original summaries of the paragraphs (reference register), never a quotation of the standard.

1 question

• Helios SA operates a chain of stores and has also, for several years, provided financing to its customers for the purchase of its products. The evidence gathered indicates that this financing activity is one of its main business activities (facts and judgement given by the case). What does IFRS 18 require for the classification of its income and expenses?L3