The statement of comprehensive income is one of the main financial statements.
The purpose of the statement is to show all changes in equity other than those resulting from investments by and distributions to the owners of the business.
Owner transactions are those such as share issues and dividends and are not part of the statement of comprehensive income. Non owner transactions are included in the statement, and are separated into items which pass through the income statement, represented by the net income of the business, and items which do not go through the income statement referred to as other comprehensive income.
Statement of Comprehensive Income Format
A typical layout for a statement of comprehensive income for a business is shown in the example below.
| Net income | 23,000 |
| Currency translation adjustment | -2,000 |
| Gains on revaluation of available for sale securities | 17,000 |
| Actuarial losses on post retirement benefit plans | -3,000 |
| Other comprehensive income | 12,000 |
| Total comprehensive income | 35,000 |
As can be seen the statement starts with the net income representing all the transactions which have passed through the income statement. The remaining lines are transactions which have not passed through the income statement, and which combined total to other comprehensive income. As the total comprehensive income results in a change in equity, the total (or its components) also forms part of the Statement of Changes in Equity.
As a further example, the annual report for Apple shows in PDF format a typical consolidated statement of comprehensive income.
Conclusion
In conclusion, the statement of comprehensive income provides important information about the financial performance and health of a business. It gives a more complete picture of the financial results by including items that are not reflected in the income statement, and helps investors and analysts assess the long-term financial prospects of the business.
About the Author
Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an accountant and consultant for more than 25 years and has built financial models for all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a degree from Loughborough University.