I was busy trying to update my class for the fall here. It seems discontinued operations turn a turn backwards, is that right? Anybody else following this one? Last year, they were trying to make the “thing” (to get technical) that qualifies for discontinued operations treatment be larger than in the past (be a SFAS 131 segment). I see retraction from that stance. If i am right about that, it makes sense to me. If the FASB had proceeded with the SFAS 131 segment, then almost nothing would qualify for discontinued operations treatment. Starbucks, for example, would have to get rid of all of their North American stores to qualify for discontinued operations treatment.

Given that the goal is to estimate future cash flows, then it makes sense to go smaller on what constitues a discontinued operation.

Anyone have any insights on this?