Page 211 - F1 Integrated Workbook STUDENT 2018

IFRS 5 Non-current assets held for sale and discontinued
operations

Note* for restructuring costs

Restructuring costs have been treated as a material item due to their nature,
i.e. unusual item not expected to occur on a regular basis and their size. This
means they will be shown as a separate item on the statement of profit or loss,
rather than be part of other operating expenses. They are not a regular
operating expense of the business.

Note** for discontinued operations

Revenue 650
Operating expenses (525)
––––
Profit from operations 125
Loss on asset disposal (50)
––––
Tax expense 75
Profit for the period (25)
––––
50
––––

Extract from notes to the financial statements:

During the year ended 31 March 20X1, Echo closed down Division B, for
which the results are separately disclosed. As a result of the discontinued
operation, losses on the disposal of assets were incurred of $50,000.

As a consequence of the discontinuance of Division B, restructuring costs
were incurred of $80,000 in order to rationalise the remaining divisions.

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