Floothair plc is a large international airline company with three operating segments: International airline business Domestic airline

Question:

Floothair plc is a large international airline company with three operating segments:

  • International airline business
  • Domestic airline business
  • Non-airline business.

The company reports segment information for the year to 31 May 2018 in accordance with IFRS8 Operating Segments. The following information is available for the year:


£m

Total revenue:


International airline business

8,207

Domestic airline business

402

Non-airline business

267

Unallocated income

22

Profit/(loss) before tax and finance costs:


International airline business

803

Domestic airline business

(30)

Non-airline business

16

Profit on sale of assets:


Non-airline business

32

Unallocated

4

Net finance costs

149

Income tax expense

170



Assets:


International airline business

12,050

Domestic airline business 

240

Non-airline business

140

Liabilities:


International airline business

4,566

Domestic airline business

84

Non-airline business

350

Unallocated

5,420

Total revenue includes the following inter-segment sales:


International airline business 

103

Domestic airline business

14

Non-airline business

7


Required:

(a) Prepare, insofar as the above information permits, a segment report for Floothair plc for the year to 31 May 2018. Assume that the company decides to treat all three segments as reportable segments.

(b) Use the segment report to identify three significant aspects of the performance of Floothair plc which would not otherwise be evident. 

(CIPFA)

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