Statement of Comprehensive Income

Question 1

Comprehensive income equation

Answer 1

Comprehensive Income = Net Income + Other Comprehensive Income

Question 2

Items included in Other Comprehensive Income (OCI)

Answer 2

DENT

1. deferred gains/losses from Derivatives
2. unrecognized cost/gains from Employee-related benefits (Pensions, other post-retirement benefits, etc.)
3. uNrealized gains/losses on AFS securities
4. foreign currency Translation adjustments

Question 3

Statement Presentation

Answer 3

1. Single statement (included at the bottom of Income Statement)
2. Two Statements (I/S and Stmt of Comprehensive INcome)

Question 4

Reason for comprehensive income reporting

Answer 4

To report the change in net assets (owner’s equity) during the period from all sources other than from transactions with owners.

Question 5

OCI Reporting

Answer 5

Other Comprehensive Income (OCI) items are generally reported net of tax. Disclosure of pre- and post- tax amounts and amounts reclassed to the I/S must accompany the financial statements.

Question 6

Comprehensive Income does NOT include:

Answer 6

• retrospective effects of changes in accounting principle

- prior period adjustments

Question 7

SFAC 6

Answer 7

Comprehensive income includes all changes in equity during a period except those resulting from investments by owners and distributions to owners.