J Sainsbury plc – Annual report – 28 February 2026
Industry: retail
4 Critical accounting judgements and key sources of estimation uncertainty (extract)
4.1 Critical accounting judgements (extract)
Aggregation of operating segments
The Group’s operating segments have been determined based on the information regularly provided to the Chief Operating Decision Maker (CODM). In the current period, it has been reassessed that the CODM is considered to be the Group PLC Board, which uses the information regularly provided to make optimal decisions on the allocation of resources and assess performance.
Additionally in the current period, to ensure appropriate focus on both the Sainsbury’s and Argos businesses, the operating results of these two businesses are now regularly reviewed by the CODM to make decisions about the resources to be allocated to each. There are clear separate responsibilities for the commercial proposition across Sainsbury’s (including Grocery, General Merchandise and Clothing) and Argos respectively.
As such, during the current period, the CODM has been presented information for the following operating segments:
- Retail – Sainsbury’s
- Retail – Argos
- Financial Services
This differs from the prior year, whereby the CODM was presented with information for Food; General Merchandise and Clothing; and Financial Services respectively.
Management has considered the economic characteristics, in particular average gross margin, similarity of products, production processes, customers, sales methods and regulatory environment of its two Retail segments. In doing so it has been concluded that they should be aggregated into one ‘Retail’ segment within the financial statements given the similar economic characteristics between the two. This aggregated information provides users with the financial information needed to evaluate the business and the environment in which it operates.
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