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Statement of Financial Accounting Standards No. 130 - page 28 / 57

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72. In considering other terminology that could be used to describe the

aggregate total referred to by this Statement as comprehensive income, the

Board acknowledged that in paragraph 13 of Concepts Statement 5, the terms

comprehensive income and total nonowner changes in equity are used as

synonyms:  "A full set of financial statements for a period should show . .

. comprehensive income (total nonowner changes in equity) for the period"

(footnote reference omitted).  In paragraph 40 of that Concepts Statement

the Board noted that:

       Just as a variety of terms are used for net income in present

    practice, the Board anticipates that total nonowner changes in

    equity, comprehensive loss, and other equivalent terms will be

    used in future financial statements as names for comprehensive

    income.

Nonetheless, the term comprehensive income is used consistently throughout

the remainder of Concepts Statement 5 and throughout Concepts Statement 6.

73. In its redeliberations, the Board discussed whether it should continue

using the term comprehensive income in this Statement.  The Board believes

that as a result of the Exposure Drafts on comprehensive income and

derivatives and hedging, the term comprehensive income has become more

familiar and better understood.  Although some constituents argued that the

items described as other comprehensive income are not "true" gains and

losses, they are defined as gains and losses by the Concepts Statements.

Therefore, the Board decided that it is appropriate to continue using the

term comprehensive income rather than total nonowner changes in equity in

this Statement.

74. The Board also reasoned that once it addresses the conceptual issues in

a broader-scope project on comprehensive income, it can consider requiring

comprehensive income to be reported in a statement of financial

performance.  If comprehensive income was ultimately to be reported in a

statement of financial performance, the term comprehensive income is more

descriptive of a performance measure than are other terms such as total

nonowner changes in equity. Therefore, the Board decided that it would be

instructional to continue using the term comprehensive income throughout

this Statement.  However, it decided to clarify that the term comprehensive

income is not required and that other terms may be used to describe that

amount.  The Board decided to make that clarification by including a

footnote reference to paragraph 40 of Concepts Statement 5 in this

Statement.

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