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Statement of Financial Accounting Standards No. 130 - page 21 / 57





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Benefits and Costs

51. In accomplishing its mission, the Board follows certain precepts,

including the precept to promulgate standards only when the expected

benefits of the information exceed the perceived costs.  The Board

endeavors to determine that a standard will fill a significant need and

that the costs imposed to meet that standard, as compared to other

alternatives, are justified in relation to the overall benefits of the

resulting information.

52. Based on the recommendations by users of financial statements, the

increasing use of separate accounts in equity for certain comprehensive

income items, and issues arising in the financial instruments project, the

Board concluded that a standard on reporting comprehensive income was

needed.  This Statement should help facilitate a better understanding of an

enterprise's financial activities by users of financial statements because

it will result in enhanced comparability within and between enterprises by

providing more consistency as to how the balances of components of other

comprehensive income and changes in them are presented in financial

statements.  Moreover, this Statement provides a method for reporting

comprehensive income that should prove helpful in addressing and resolving

issues that potentially include items of comprehensive income now and in

the future.  Because enterprises already accumulate information about

components of what this Statement identifies as other comprehensive income

and report that information in a statement of financial position or in

notes accompanying it, the Board determined that there would be little

incremental cost associated with the requirements of this Statement beyond

the cost of understanding its requirements and deciding how to apply them.

Conclusions on Basic Issues


53. The Board decided to limit the project's scope to issues of reporting

and display of comprehensive income so that it could complete the project

in a timely manner.  The Board concluded that timely completion was

important because of the project's relationship to the project on

accounting for derivatives and hedging activities.

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