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Statement of Financial Accounting Standards No. 130 - page 7 / 57

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Classifications within Other Comprehensive Income

17.  Items included in other comprehensive income shall be classified based

on their nature.  For example, under existing accounting standards, other

comprehensive income shall be classified separately into foreign currency

items, minimum pension liability adjustments, and unrealized gains and

losses on certain investments in debt and equity securities.  Additional

classifications or additional items within current classifications may

result from future accounting standards.

Reclassification adjustments

18.  Adjustments shall be made to avoid double counting in comprehensive

income items that are displayed as part of net income for a period that

also had been displayed as part of other comprehensive income in that

period or earlier periods.   For example, gains on investment securities

that were realized and included in net income of the current period that

also had been included in other comprehensive income as unrealized holding

gains in the period in which they arose must be deducted through other

comprehensive income of the period in which they are included in net income

to avoid including them in comprehensive income twice.  Those adjustments

are referred to in this Statement as reclassification adjustments.

19.  An enterprise shall determine reclassification adjustments for each

classification of other comprehensive income, except minimum pension

liability adjustments. The requirement for a reclassification adjustment

for Statement 52 foreign currency translation adjustments is limited to

translation gains and losses realized upon sale or upon complete or

substantially complete liquidation of an investment in a foreign entity.

20.  An enterprise may display reclassification adjustments on the face of

the financial statement in which comprehensive income is reported, or it

may disclose reclassification adjustments in the notes to the financial

statements.  Therefore, for all  classifications of other comprehensive

income other than minimum pension liability adjustments, an enterprise may

use either (a) a gross display on the face of the financial statement or

(b) a net display on the face of the financial statement and disclose the

gross change in the notes to the financial statements.\6/  Gross and net

displays are illustrated in Appendix B.  An example of the calculation of

reclassification adjustments for Statement 115 available-for-sale

securities is included in Appendix C.

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