UK Accounting Glossary
Discontinued in a financial context is usually associated with discontinued operations. When companies dispose of operations that can be identified as a specific, separate segment of their business, these activities are considered discontinued operations. GAAP provides for separate disclosure of discontinued operations, which warns investors that these activities will no longer be part of the company. The accounting rules for discontinued operations are somewhat complex. But put simply, the discontinued operations section — which on the income statement appears before any extraordinary items and the effect of accounting changes — has two components. First, there is the income (or loss) from discontinued operations for that fiscal period. Second, there is the overall gain (or loss) recorded on the disposal of the discontinued operations. Additional information about discontinued operations also appears in the footnotes to the statements.
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This glossary post was last updated: 9th February 2020.