Proposed ASU on Comprehensive Income

The FASB issued the Proposed Accounting Standards Update Comprehensive Income (Topic 220), Statement of Comprehensive Income on May 26, 2010. The comment period ends September 30, 2010

Under the amendments in this proposed Update an entity would be

• Required to report total comprehensive income and its components in two parts— net income and other comprehensive income—in a continuous statement of financial performance.
• Required to display a total for each part
• Required to display each component of net income and each component of other comprehensive income in that statement of financial performance.

The amendments in this proposed Update would not

• Change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income.
• Change the option for an entity to show components of other comprehensive income gross or net of the effect of income taxes in the statement of comprehensive income as long as the tax effect for each component is disclosed in the notes to the financial statements or is displayed parenthetically on the statement of comprehensive income.
• Affect how earnings per share are calculated or reported.

The amendments in this proposed Update would be applied on a fully retrospective basis to improve comparability between reporting periods.

Early adoption would be permitted, because compliance with the proposed amendments is already permitted. The amendments do not require any transition disclosures.

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