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Statement of Financial Accounting Standards No. 130 - page 24 / 57

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characterized as a performance measure because of management's inability to

control the market forces that could result in that measure being volatile

from period to period.

61. Many respondents suggested that the Board could achieve the desired

transparency for the components of other comprehensive income by requiring

that they be displayed in an expanded statement of changes in equity or in

a note to the financial statements.  Respondents said that either of those

types of display would be more acceptable than display in a performance

statement because the components of other comprehensive income would not be

characterized as being performance related.

62. In response to constituents' concerns about the requirement in the

Exposure Draft to report comprehensive income and its components in a

statement of financial performance, the Board considered three additional

approaches in its redeliberations.  The first approach would require

disclosure of comprehensive income and its components in a note to the

financial statements.  The second approach would require the display of

comprehensive income and its components in a statement of changes in

equity.  The third approach would require the reporting of comprehensive

income and its components in a financial statement that is displayed with

the same prominence as other financial statements, thereby permitting an

enterprise to report the components of comprehensive income in one or two

statements of financial performance as proposed by the Exposure Draft or in

a statement of changes in equity if that statement was presented as a

financial statement.

63. The Board decided against permitting an enterprise to disclose

comprehensive income and its components in a note to the financial

statements.  The Board acknowledged that it could justify note disclosure

because it would provide important information in the interim while the

conceptual issues surrounding comprehensive income reporting were studied

in more depth.  However, the Board decided that such disclosure would be

inconsistent with the Concepts Statements, which both define comprehensive

income and call for the reporting of it as part of a full set of financial

statements.  The Board also agreed that only disclosure of comprehensive

income and its components was inconsistent with one of the objectives of

the project, which was to take a first step toward the implementation of

the concept of comprehensive income by requiring that its components be

displayed in a financial statement.

64. The Board also decided against requiring that an enterprise display

comprehensive income and its components in a statement of changes in

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