FASB Calls for Data on All Segments of a Firm

Companies with diversified operations will have to start providing quarterly information for each business segment under a new Financial Accounting Standards Board rule announced this week. The measure is intended to give investors more information, said Tim Lucas, the board’s director of research and technical activities. “The larger and more diversified a company is, the more interesting the segment information is going to be, but it will affect all public companies.” The FASB said its latest rule will take effect for quarterly and annual reports on fiscal years ending after Dec. 15. The rule will replace one adopted in the mid-1970s that let companies report results based on broad descriptions of product and service lines. Under the new standard, a company such as IBM Corp., for example, will be required to report on personal computers, mainframes or consulting segments separately. The FASB said it defines segments as “components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker.”