F1 M7 Stmt of Comprehensive Income

Under Us GAAP, comprehensive income may be presented in2 forms

-a single stmt of comp incm (single-stmt approach) or -an income stmt followed by a separate stmt of comp income that begins with NI (two-stmt approach)

required disclosures concerning comp income

-tax effects of each component included in current OCI, either as a part of the stmt presentation or in the notes to the FS -changes in the accumulated balances of each component of OCI, either on the face of FS or in notes -total accumulated OCI in the BS as an equity item -reclassification adjustments (changes in AOCI balances and significant items reclassified out of AOCI) -

the following types of unrealized gains and losses on certain investments in debt securities are reported as components of OCI until the securities are sold:

-unrealized holding gains and losses on AFS debt sec -unrealized holding gains and losses that result from a debt security being transferred into the AFS category from HTM -subsequent decreases or increases in the FV of AFS debt securities previously written down as impaired

net income includes the following items

1. income from continuing operations 2. discontinued operations

explain what the I in PUFIE stands for

Instrument Specific Credit risk -for liab for which the Fair value option is elected, changes in fair value that are attributable to instrument-specific credit risk are included in comprehensive income

acroynm for OCI items

PUFIE Pension adjustments Unrealized gains and losses (AFS debt sec) Foreign currency items Instrument-Specific credit risk Effective portion of cash flow hedges

where does OCI flow to?

PUFIE goes to equity/accumulated OCI on BS

where does NI flow to?

RE in BS

how is interim period reporting related to compr income

a total for comprehensive income shall be reported in condensed FS of interim periods issued to shareholders

comprehensive income

change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from nonowner sources -includes all changes in equity during a period except those resulting from investments by owners and distributions to owners Net income and OCI and nonowners transactions

AOCI

component of equity that includes the total of OCI for the current period and all previous periods -OCI is closed to this account, which is reconciled each period similar to the manner in which RE is reconciled

single stmt approach

displays OCI items individually and in total, below the NI amount, and totals them for comprehensive income

where is the income tax expense or benefit displayed

either on the face of the stmt in which those components are displayed or in the notes to the FS

gains and losses on intra-entity foreign currency transactions that are of a LT investment nature, when the entities to the transaction are consolidated, are accounted for how?

equity method

T/F: At the beginning of each accounting period, all components of comp incm are closed to the BS. NI is closed to RE, and OCI is closed to AOCI

false; at the end of each accounting period

T/FL: comprehensive income can be reported on a per share basis

false; it should not be reported on a per share basis

reclassification adjustments

move OCI items from AOCI to the IS

how to calculate comprehensive income

net income +other comprehensive income=comprehensive income

components of OCI may be reported either as

net of tax or before related tax effects, with one amount shown for the aggregate income tax expense or benefit related to the total of OCI items

the requirements to present comp income do not apply to...

not-for-profit entities or to any company that does not have any time of OCI

what is other comprehensive income?

other comprehensive income items are revenues, expenses, gains, and losses that are included in comprehensive income but excluded from net income under US GAAP

the effective portion of a cash flow hedge is reported as component of OCI until when?

until the cash flows associated with the hedge item are realized

foreign currency translation adjustments remain in OCI until when?

until the sale or liquidation of the investment in the foreign entity