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Statement of Financial Accounting Standards No. 130 - page 5 / 57





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end of the period, earnings (net income) for the period, comprehensive

income (total nonowner changes in equity) for the period, cash flows during

the period, and investments by and distributions to owners during the

period" (paragraph 13, footnote references omitted).  Prior to issuance of

this Statement, the Board had neither required that an enterprise report

comprehensive income, nor had it  recommended a format for displaying

comprehensive income.

Use of the Term Comprehensive Income

10.  This Statement uses the term comprehensive income to describe the

total of all components of comprehensive income, including net income.\4/

This Statement uses the term other comprehensive income to refer to

revenues, expenses, gains, and losses that under generally accepted

accounting principles are included in comprehensive income but excluded

from net income.  This Statement does not require that an enterprise use

the terms comprehensive income or other comprehensive income in its

financial statements, even though those terms are used throughout this



\4/  This Statement uses the term net income to describe a measure of

    financial performance resulting from the aggregation of revenues,

    expenses, gains, and losses that are not items of other comprehensive

    income as identified in this Statement.  A variety of other terms such as

    net earnings or earnings may be used to describe that measure.

\5/  Paragraph 40 of Concepts Statement 5 states 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."


Purpose of Reporting Comprehensive Income

11.  The purpose of reporting comprehensive income is to report a measure

of all changes in equity of an enterprise that result from recognized

transactions and other economic events of the period other than

transactions with owners in their capacity as owners.  Prior to the

issuance of this Statement, some of those changes in equity were displayed

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