A public entity sells steel for use in construction. One of its customer's accounts for 43% of sales, and another customer accounts for 40% of sales. What should the entity disclose in its annual financial statements about these two customers?

Question

Turner

Business

20 December, 19:00

A public entity sells steel for use in construction. One of its customer's accounts for 43% of sales, and another customer accounts for 40% of sales. What should the entity disclose in its annual financial statements about these two customers?

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Jared Sharp · Answer 1

Based on the information provided within the question it can be said that the entity must disclose

(1) the fact that the account holds a large percentage of revenue

(2) the amount of revenue from each such customer

(3) the segment (s) reporting the revenues

All of this must be disclosed by any and all public entities within it's financial statements, any time that a single customer holds 10% or more of the entities revenue derived from sales. Which is the case in this scenario.