# ASC 220-10-55: Income Statement—Reporting Comprehensive Income — Overall — 55 Implementation Guidance and Illustrations

Source: FASB Accounting Standards Codification, Basic View

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## ASC 220-10-55: 55 Implementation Guidance and Illustrations

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#### Implementation Guidance

##### [220-10-55-1](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-1)

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This Section provides Examples of reporting formats for [comprehensive income](https://asc.understandingaccounting.org/glossary/c/#comprehensive-income "The change in equity (net assets) of a business entity during a period from transactions and other events and circumstances from nonowner sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. Comprehensive income comprises both of the following:All components of net incomeAll components of other comprehensive income."), required disclosures, and a corresponding statement of financial position. The illustrations are intended as examples only. Other formats or levels of detail may be appropriate for certain circumstances. An entity is encouraged to provide information in ways that are most understandable to investors, lenders, and other external users of financial statements. For simplicity, the Examples provide information only for a single period; however, most entities are required to provide comparative financial statements. In addition to the Examples in this Section, paragraph [810-10-55-4C](https://asc.understandingaccounting.org/asc/810/10/#810-10-55-4C) illustrates one method for reporting comprehensive income if the entity has one or more less-than-wholly-owned subsidiaries.

##### [220-10-55-2](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-2)

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[Paragraph superseded by Accounting Standards Update No. 2011-05](https://asc.understandingaccounting.org/updates/asu-2011-05/).

##### [220-10-55-3](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-3)

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[Paragraph superseded by Accounting Standards Update No. 2011-05](https://asc.understandingaccounting.org/updates/asu-2011-05/).

#### Illustrations

##### [220-10-55-4](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-4)

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This Example illustrates the various formats that may be used to report comprehensive income as discussed in paragraphs

[220-10-45-1 through 45-17](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-1)

.

##### [220-10-55-5](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-5)

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Brackets are used to highlight certain basic totals that must be presented in financial statements to comply with the provisions of this Subtopic. This Subtopic requires not only presenting those certain basic totals but also reporting components of those aggregates. For example, among other items, it requires reporting information about unrealized gains and losses on available-for-sale debt securities, foreign currency items, gains or losses associated with pension or other postretirement benefits, prior service costs or credits associated with pension or other postretirement benefits, and transition assets or obligations associated with pension or other postretirement benefits.

##### [220-10-55-6](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-6)

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The tables use the term _comprehensive income_ to label the total of all parts of comprehensive income, including [net income](https://asc.understandingaccounting.org/glossary/n/#net-income "A measure of financial performance resulting from the aggregation of revenues, expenses, gains, and losses that are not items of other comprehensive income. A variety of other terms such as net earnings or earnings may be used to describe net income."). The tables use the term [other comprehensive income](https://asc.understandingaccounting.org/glossary/o/#other-comprehensive-income "Revenues, expenses, gains, and losses that under generally accepted accounting principles (GAAP) are included in comprehensive income but excluded from net income.") to label revenues, expenses, gains, and losses that are included in comprehensive income but excluded from net income. This Subtopic does not require that an entity use those terms in its financial statements. Other equivalent terms, such as _total nonowner changes in equity_, can be used as labels for what this Subtopic refers to as comprehensive income.

##### [220-10-55-7](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-7)

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The following illustrates the statement of comprehensive income for the year ended December 31, 201X, with other comprehensive income components shown net of tax effects.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-37821D80-59FA-4CBA-982C-497684ED0C14-low.gif)
    
    Entity XYZ Consolidated Statement of Comprehensive Income " Year Ended December 31, 201X" Revenues " $140,000 " Expenses " (65,700)" Other gains and losses " 8,000 " Gain on sale of securities " 2,500 " Income from operations before tax " 84,800 " Income tax expense " (21,200)" \[Net income " 63,600 " \] Less: net income attributable to the noncontrolling interest " $(12,720)" Net income attributable to Entity XYZ shareholders " 50,880 " Earnings per share Basic and diluted 0.46 "Other comprehensive income, before tax:" Foreign currency translation adjustments (a) " 8,000 " Unrealized gains on debt securities: (b) $ Unrealized holding gains arising during period "13,000" Less: reclassification adjustment for gains included in net income " (1,500)" " 11,500 " Defined benefit pension plans: (c) Prior service cost arising during period " (1,600)" Net loss arising during period " (1,600)" Less: amortization of prior service cost included in net periodic pension cost 100 " (2,500)" \[Other comprehensive income " 17,000" \] \[Comprehensive income " 80,600 " \] Less: comprehensive income attributable to the noncontrolling interest " (16,120)" Comprehensive income attributable to Entity XYZ shareholders " $64,480 " (a) "It is assumed that there was no sale or liquidation of an investment in a foreign entity. Therefore, there is no reclassification adjustment for this period." (b) "This illustrates the gross display of amounts reclassified out of accumulated other comprehensive income. Alternatively, a net display can be used, with disclosure of the gross amounts (current-period gain and reclassification adjustment) in the notes to financial statements." (c) "This illustrates the gross display of amounts reclassified out of accumulated other comprehensive income. Alternatively, a net display can be used, with disclosure of the gross amounts (prior service cost and net loss for the defined benefit pension plans less amortization of prior service cost) in the notes to financial statements."
    

Transition date:(P) December 16, 2026; (N) December 16, 2026Transition guidance:

[105-10-65-10](https://asc.understandingaccounting.org/asc/105/10/#105-10-65-10)The following illustrates the statement of comprehensive income for the year ended December 31, 201X, with other comprehensive income components shown net of tax effects.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-B070A24D-728A-438E-AF2F-0423E43C3C63-low.gif)
    
    Entity XYZ Consolidated Statement of Comprehensive Income " Year Ended December 31, 201X" Revenues " $140,000 " Expenses " (65,700)" Other gains and losses " 8,000 " Gain on sale of securities " 2,500 " Income from operations before tax " 84,800 " Income tax expense " (21,200)" \[Net income " 63,600 " \] Less: net income attributable to the noncontrolling interest " $(12,720)" Net income attributable to Entity XYZ shareholders " 50,880 " Earnings per share Basic and diluted 0.46 "Other comprehensive income, net of tax:" Foreign currency translation adjustments (a) " 8,000 " Unrealized gains on debt securities: (b) $ Unrealized holding gains arising during period "13,000" Less: reclassification adjustment for gains included in net income " (1,500)" " 11,500 " Defined benefit pension plans: (c) Prior service cost arising during period " (1,600)" Net loss arising during period " (1,000)" Less: amortization of prior service cost included in net periodic pension cost 100 " (2,500)" \[Other comprehensive income " 17,000" \] \[Comprehensive income " 80,600 " \] Less: comprehensive income attributable to the noncontrolling interest " (16,120)" Comprehensive income attributable to Entity XYZ shareholders " $64,480 " (a) "It is assumed that there was no sale or liquidation of an investment in a foreign entity. Therefore, there is no reclassification adjustment for this period." (b) "This illustrates the gross display of amounts reclassified out of accumulated other comprehensive income. Alternatively, a net display can be used, with disclosure of the gross amounts (current-period gain and reclassification adjustment) in the notes to financial statements." (c) "This illustrates the gross display of amounts reclassified out of accumulated other comprehensive income. Alternatively, a net display can be used, with disclosure of the gross amounts (prior service cost and net loss for the defined benefit pension plans less amortization of prior service cost) in the notes to financial statements."

##### [220-10-55-8](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-8)

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Alternatively, components of other comprehensive income could be presented before tax with one amount shown for the aggregate income tax expense or benefit, as shown in the following single continuous statement of comprehensive income.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-A8CDAD0A-1AF7-4A5C-82A1-95A1BC85DB40-low.gif)
    
    Entity XYZ Consolidated Statement of Comprehensive Income " Year Ended December 31, 201X" Revenues " $140,000 " Expenses " (65,700)" Other gains and losses " 8,000 " Gain on sale of securities " 2,500 " Income from operations before tax " 84,800 " Income tax expense " (21,200)" \[Net income " 63,600 " \] Less: net income attributable to the noncontrolling interest " $(12,720)" Net income attributable to Entity XYZ shareholders " 50,880 " Earnings per share Basic and diluted 0.46 "Other comprehensive income, before tax:" Foreign currency translation adjustments (a) " 10,666 " Unrealized gains on debt securities: (b) $ Unrealized holding gains arising during period " 17,333" Less: reclassification adjustment for gains included in net income " (2,000)" " 15,333 " Defined benefit pension plans: (c) Prior service cost arising during period " (2,133)" Net loss arising during period " (1,333)" Less: amortization of prior service cost included in net periodic pension cost 133 " (3,333)" "Other comprehensive income, before tax" " 22,666 " 6 \[Income tax expense related to items of other comprehensive income " (5,666)" \] \] "\[Other comprehensive income, net of tax" " 17,000" \] \[Comprehensive income " 80,600 " \] Less: comprehensive income attributable to the noncontrolling interest " (16,120)" Comprehensive income attributable to Entity XYZ shareholders " $64,480 " (a) "It is assumed that there was no sale or liquidation of an investment in a foreign entity. Therefore, there is no reclassification adjustment for this period." (b) "This illustrates the gross display of amounts reclassified out of accumulated other comprehensive income. Alternatively, a net display can be used, with disclosure of the gross amounts (current-period gain and reclassification adjustment) in the notes to the financial statements." (c) "This illustrates the gross display of amounts reclassified out of accumulated other comprehensive income. Alternatively, a net display can be used, with disclosure of the gross amounts (prior service cost and net loss for the defined benefit pension plans less amortization of prior service cost) in the notes to the financial statements."

##### [220-10-55-8A](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-8A)

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The following table illustrates disclosure of the tax effects allocated to each component of other comprehensive income in the notes to financial statements for the year ended December 31, 201X.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-7F4B17F7-ED86-4AAE-8A09-7DB27EDD43C7-low.gif)
    
    "Entity XYZ Notes to Financial Statements Year Ended December 31, 201X " Before-Tax Amount Tax (Expense) or Benefit Net-of-Tax Amount Foreign currency translation adjustments " $10,666 " " $(2,666)" " $8,000 " Unrealized gains on debt securities: Unrealized holding gains arising during period " 17,333 " " (4,333)" " 13,000 " Less: reclassification adjustment for gains realized in net income " (2,000)" 500 " (1,500)" Net unrealized gains " 15,333 " " (3,833)" " 11,500 " Defined benefit pension plans: Prior service cost from plan amendment during period " (2,133)" 533 " (1,600)" Less: amortization of prior service cost included in net periodic pension cost 133 (33) 100 Net prior service cost arising during period " (2,000)" 500 " (1,500)" Net loss arising during period " (1,333)" 333 " (1,000)" "Defined benefit pension plans, net" " (3,333)" 833 " (2,500)" Other comprehensive income " $22,666 " " $(5,666)" " $17,000 "

##### [220-10-55-8B](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-8B)

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Alternatively, the tax amounts for each component can be presented in the statement in which each component of other comprehensive income is presented.

##### [220-10-55-9](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-9)

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The following illustrates the statements of net income and other comprehensive income for the year ended December 31, 201X, with other comprehensive income components presented net of tax effects.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-2D8862C3-046B-4E44-88C6-58277FC133B1-low.gif)
    
    Entity XYZ Consolidated Statement of Comprehensive Income " Year Ended December 31, 201X" Revenues " $140,000 " Expenses " (65,700)" Other gains and losses " 8,000 " Gains on sale of securities " 2,500 " Income from operations before tax " 125,000 " " 84,800 " Income tax expense " (31,250)" " (21,200)" \[Net income " 63,250 " " 63,600 " \] Less: net income attributable to the noncontrolling interest " (12,720)" Net income attributable to Entity XYZ " $50,880 " Earnings per share Basic and diluted 0.46 0.46 (b) "This illustrates the gross display. Alternatively, a net display can be used, with disclosure of the gross amounts (current-period gain and reclassification adjustment) in the notes to the financial statements." (c) "This illustrates the gross display. Alternatively, a net display can be used, with disclosure of the gross amounts (prior service cost and net loss for the defined benefit pension plans less amortization of prior service cost) in the notes to financial statements."
    
-   ![](https://asc.understandingaccounting.org/asc-img/GUID-D603A9CB-64E4-42AC-BCBB-42EF72134C25-low.gif)
    
    Entity XYZ Statement of Consolidated Comprehensive Income " Year Ended December 31, 201X" Net income " $63,600 " "Other comprehensive income, net of tax:" Foreign currency translation adjustments (a) " 8,000 " Unrealized gains on debt securities: (b) Unrealized holding gains arising during period " $13,000 " Less: reclassification adjustment for gains included in net income " (1,500)" " 11,500 " Defined benefit pension plans: (c) Prior service cost arising during period " (1,600)" Net loss arising during period " (1,000)" Less: amortization of prior service cost included in net periodic pension cost 100 " (2,500)" \[Other comprehensive income " 17,000 " \] \[ Comprehensive income " 80,600 " \] Less: comprehensive income attributable to the noncontrolling interest " (16,120)" Comprehensive income attributable to Entity XYZ shareholders " $64,480 " (a) "It is assumed that there was no sale or liquidation of an investment in a foreign entity. Therefore, there is no reclassification adjustment for this period." (b) "This illustrates the gross display of amounts reclassified out of accumulated other comprehensive income. Alternatively, a net display can be used, with disclosure of the gross amounts (current-period gain and reclassification adjustment) in the notes to the financial statements." (c) "This illustrates the gross display of amounts reclassified out of accumulated other comprehensive income. Alternatively, a net display can be used, with disclosure of the gross amounts (prior service cost and net loss for the defined benefit pension plans less amortization of prior service cost) in the notes to the financial statements."

##### [220-10-55-10](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-10)

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[Paragraph superseded by Accounting Standards Update No. 2011-05](https://asc.understandingaccounting.org/updates/asu-2011-05/).

##### [220-10-55-10A](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-10A)

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The following table illustrates the presentation of accumulated other comprehensive income in the statement of financial position, as discussed in paragraph [220-10-45-14](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-14).

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-46D2F8A6-594D-4EB7-A1BF-221B5B531842-low.gif)
    
    Entity XYZ Consolidated Statement of Financial Position " December 31, 201X" Assets: Cash " $150,000 " Accounts receivable " 175,000 " Available-for-sale debt securities " 112,000 " Plant and equipment " 985,000 " Total assets " $1,422,000 " Liabilities: Accounts payable " $112,500 " Accrued liabilities " 78,583 " " 78,233 " Liability for pension benefits " 130,667 " Notes payable " 318,500 " Total liabilities " $640,250 " " $639,900 " Equity: Common stock " $200,000 " Paid-in capital " 400,000 " Retained earnings " 141,750 " " 111,680 " \[ Accumulated other comprehensive income " 40,000 " " 32,000 " \] Total Entity XYZ shareholders' equity " 743,680 " Noncontrolling interest " 38,420 " Total equity " 781,750 " " 782,100 " Total liabilities and equity " $1,422,000 "

##### [220-10-55-11](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-11)

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The following table illustrates the presentation of accumulated other comprehensive income in the statement of changes in equity for the year ended December 31, 201X, as discussed in paragraph [220-10-45-14](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-14).

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-66A9A4E5-DAD7-459F-BD62-BB2EC75E98FC-low.gif)
    
    Entity XYZ Consolidated Statement of Changes in Equity " Year Ended December 31, 201X" Total Comprehensive Income (a) "Retained Earnings" Accumulated Other Comprehensive Income Common Stock Paid-in Capital Noncontrolling Interest Beginning balance " $561,500 " " $88,500 " " $70,800 " " $23,000 " " $18,400 " " $150,000 " " $300,000 " " $22,300 " Net income " 63,250 " " 63,600 " \[ " $63,250 " " 63,250 " " 50,880 " " 12,720 " Other comprehensive income " 17,000 " " 17,000 " " 17,000 " " 13,600 " " 3,400 " Common stock issued " 150,000 " " 50,000 " " 100,000 " Dividends declared on common stock " (10,000)" " (10,000)" Ending balance " $781,750 " " $782,100 " " $141,750 " " $111,680 " " $40,000 " " $32,000 " " $200,000 " " $400,000 " " $38,420 "

##### [220-10-55-12](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-12)

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The following table illustrates the statement of changes in equity for the year ended December 31, 201X, as discussed in paragraph [220-10-45-14](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-14).

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-06BEF576-58C4-45D0-9FB2-F7567AC6CBE2-low.gif)
    
    Entity XYZ Consolidated Statement of Changes in Equity " Year Ended December 31, 201X" Retained earnings Balance at January 1 " $70,800 " Net income attributable to Entity XYZ " 50,880 " Dividends declared on common stock " (10,000)" Balance at December 31 " 111,680 " Accumulated other comprehensive income Balance at January 1 " 18,400 " Other comprehensive income " 13,600 " Balance at December 31 " 32,000 " Common stock Balance at January 1 " 150,000 " Shares issued " 50,000 " Balance at December 31 " 200,000 " Paid-in capital Balance at January 1 " 300,000 " Common stock issued " 100,000 " Balance at December 31 " 400,000 " Total Entity XYZ Shareholders' Equity " 743,680 " Noncontrolling interest Balance at January 1 " 22,300 " Net income attributable to noncontrolling interest " 12,720 " OCI attributable to noncontrolling interest " 3,400 " Balance at December 31 " 38,420 " Total equity " $782,100 "

##### [220-10-55-13](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-13)

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[Paragraph superseded by Accounting Standards Update No. 2011-05](https://asc.understandingaccounting.org/updates/asu-2011-05/).

##### [220-10-55-14](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-14)

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[Paragraph superseded by Accounting Standards Update No. 2011-05](https://asc.understandingaccounting.org/updates/asu-2011-05/).

##### [220-10-55-15](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-15)

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The following table illustrates the disclosure of changes in the balances of each component of accumulated other comprehensive income, as required by paragraph [220-10-45-14A](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-14A). The amounts in this illustration correspond to the amounts in the Example in paragraph [220-10-55-17E](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17E) and demonstrate the relationship between the requirements in paragraph [220-10-45-14A](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-14A) and the requirements in paragraph [220-10-50-6](https://asc.understandingaccounting.org/asc/220/10/#220-10-50-6) for this entity.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-1E935CF9-EE72-43A0-80B8-57543D2FF089-low.gif)
    
    Entity XYZ Notes to Financial Statements Changes in Accumulated Other Comprehensive Income by Component (a) "For the Period Ended December 31, 201X" Gains and Losses on Cash Flow Hedges Unrealized Gains and Losses on Available-for-Sale Securities Defined Benefit Pension Items Foreign Currency Items Total Beginning balance " $(1,200)" " $1,000 " " $(8,800)" " $1,300 " " $(7,700)" "Other comprehensive income before reclassifications" " 3,000 " " 2,500 " " (3,000)" " 1,000 " " 3,500 " "Amounts reclassified from accumulated other comprehensive income" (750) " (1,500)" " 4,500 " - " 2,250 " "Net current-period other comprehensive income" " 2,250 " " 1,000 " " 1,500 " " 1,000 " " 5,750 " Ending balance " $1,050 " " $2,000 " " $(7,300)" " $2,300 " " $(1,950)" (a) All amounts are net of tax. Amounts in parentheses indicate debits.

##### [220-10-55-15A](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-15A)

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The following table illustrates the disclosure of changes in the balances of each component of accumulated other comprehensive income, as required by paragraph [220-10-45-14A](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-14A). The amounts in this illustration correspond to the amounts in the Example in paragraph [220-10-55-17F](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17F).

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-690ADB99-C9FA-489C-9538-BB4347DDE450-low.gif)
    
    Entity ABC Notes to Financial Statements Changes in Accumulated Other Comprehensive Income by Component (a) "For the Period Ended December 31, 201X" Gains and Losses on Cash Flow Hedges Unrealized Gains and Losses on Available-for-Sale Debt Securities Total Beginning balance " $(5,000)" " $8,000 " " $3,000 " "Other comprehensive income before reclassifications" " 7,000 " " 8,000 " " 15,000 " "Amounts reclassified from accumulated other comprehensive income " " (2,250)" " (3,000)" " (5,250)" "Net current-period other comprehensive income" " 4,750 " " 5,000 " " 9,750 " Ending balance $(250) " $13,000 " " $12,750 " (a) All amounts are net of tax. Amounts in parentheses indicate debits.

##### [220-10-55-15B](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-15B)

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The presentation of unrealized gains and losses on available-for-sale debt securities illustrated in paragraphs [220-10-55-15 through 55-15A](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-15) is aggregated for simplicity and, therefore, does not necessarily comply with all of the disclosures that may be required in Topic 320 or 326 (for example, disclosures about [available-for-sale](https://asc.understandingaccounting.org/glossary/a/#available-for-sale-securities "Investments not classified as either trading securities or as held-to-maturity securities.") [debt securities](https://asc.understandingaccounting.org/glossary/d/#debt-security "Any security representing a creditor relationship with an entity. The term debt security also includes all of the following: Preferred stock that by its terms either must be redeemed by the issuing entity or is redeemable at the option of the investor A collateralized mortgage obligation (or other instrument) that is issued in equity form but is required to be accounted for as a nonequity instrument regardless of how that instrument is classified (that is, whether equity or debt) in the issuer's statement of financial position U.S. Treasury securities U.S. government agency securities Municipal securities Corporate bonds Convertible debt Commercial paper All securitized debt instruments, such as collateralized mortgage obligations and real estate mortgage investment conduits Interest-only and principal-only strips. The term debt security excludes all of the following: Option contracts Financial futures contracts Forward contracts Lease contracts Receivables that do not meet the definition of security and, so, are not debt securities, for example: Trade accounts receivable arising from sales on credit by industrial or commercial entities Loans receivable arising from consumer, commercial, and real estate lending activities of financial institutions.") with an allowance for credit losses in paragraph [326-30-45-2](https://asc.understandingaccounting.org/asc/326/30/#326-30-45-2)).

##### [220-10-55-15C](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-15C)

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For life insurers, amounts reclassified out of accumulated other comprehensive income exclude changes in unrealized gains and losses on available-for-sale debt securities associated with direct adjustments made to policy liabilities necessary to reflect these balances as if such unrealized gains and losses were realized.

##### [220-10-55-16](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-16)

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Alternatively, the changes in the balances of each component of other comprehensive income included in accumulated other comprehensive income can be presented as a reconciliation in a statement of changes in equity.

##### [220-10-55-17](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17)

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[Paragraph superseded by Accounting Standards Update No. 2011-05](https://asc.understandingaccounting.org/updates/asu-2011-05/).

##### [220-10-55-17A](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17A)

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The effect of reclassifications on the line items in the statement in which net income is presented, as described in paragraph [220-10-45-17](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-17), should be presented on either a before-tax basis or a net-of-tax basis consistent with the entity's method of presentation for the line items in the statement where net income is presented. In either case, the total for this disclosure should agree with the total amount of reclassifications for each component of comprehensive income that complies with the presentation requirements in paragraph [220-10-45-14A](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-14A). The illustration in paragraph [220-10-55-17E](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17E) presents the effect of reclassifications on the line items of net income on a before-tax basis, but it also shows totals for each component, which agree with the ending balances presented in paragraph [220-10-55-15](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-15), which is on an after-tax basis.

##### [220-10-55-17B](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17B)

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An entity with significant defined benefit pension costs reclassified out of accumulated other comprehensive income should identify the amount of each pension cost component reclassified out of accumulated other comprehensive income and make reference to the relevant pension cost disclosure that provides greater detail about these reclassifications.

##### [220-10-55-17C](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17C)

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A life insurer may make adjustments to unrealized gains and losses on available-for-sale debt securities for the effect on relevant assets and liabilities (as specified in paragraph [320-10-S99-2](https://asc.understandingaccounting.org/asc/320/10/#320-10-S99-2) for public entities) as if the unrealized gains and losses had been realized. In such cases, the life insurer should cross-reference to the related notes.

##### [220-10-55-17D](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17D)

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Some entities may not have a separate line item for realized gains/(losses) on the sale of securities and, instead, will include this amount as part of another line item, for example, other income/(expense).

##### [220-10-55-17E](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17E)

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The following illustrates a disclosure in a tabular format of significant amounts reclassified out of each component of accumulated other comprehensive income, as required by paragraph [220-10-50-6](https://asc.understandingaccounting.org/asc/220/10/#220-10-50-6). The amounts used in this Example correspond to those in the Example in paragraph [220-10-55-15](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-15).

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-0FF0CF86-F733-4424-B76F-3E63DD7639AC-low.gif)
    
    Entity XYZ Notes to Financial Statements Reclassifications Out of Accumulated Other Comprehensive Income (a) "For the Period Ended December 31, 201X" "Details about Accumulated Other Comprehensive Income Components" Amount Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the Statement Where Net Income Is Presented Gains and losses on cash flow hedges Interest rate contracts " $1,000 " Interest income/(expense) Credit derivatives (500) Other income/(expense) Foreign exchange contracts " 2,500 " Sales/revenue Commodity contracts " (2,000)" Cost of sales " 1,000 " Total before tax (250) Tax (expense) or benefit $750 Net of tax "Unrealized gains and losses on available-for-sale debt securities" " $2,300 " "Realized gain/(loss) on sale of securities" (285) Impairment expense Insignificant items (15) " 2,000 " Total before tax (500) Tax (expense) or benefit " $1,500 " Net of tax Amortization of defined benefit pension items Prior-service costs " $(2,000)" (b) Other income/(expense) Transition obligation " (2,500)" (b) Other income/(expense) Actuarial gains/(losses) " (1,500)" (b) Other income/(expense) " (6,000)" Total before tax " 1,500 " Tax (expense) or benefit " $(4,500)" Net of tax Total reclassifications for the period " $(2,250)" Net of tax (a) Amounts in parentheses indicate debits to profit/loss. (b) These accumulated other comprehensive income components are components of net periodic pension cost (see pension note for additional details).

##### [220-10-55-17F](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-17F)

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The following illustrates presentation of the effect on certain line items of net income of significant amounts reclassified out of each component of accumulated other comprehensive income, as required by paragraph [220-10-45-17A](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-17A). The amounts in this Example agree with the amounts in the Example in paragraph [220-10-55-15A](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-15A). This presentation should only be used if all significant reclassifications out of accumulated other comprehensive income are reclassified to net income in their entirety in the same reporting period.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-355325FD-8490-4C54-8CF7-C627CB8303ED-low.gif)
    
    Entity ABC Statement of Income "For the Period Ended December 31, 201X" "Revenues (includes $4,000 accumulated other comprehensive income reclassifications for net gains on cash flow hedges)" " $122,500 " "Expenses (includes ($1,000) accumulated other comprehensive income reclassifications for net losses on cash flow hedges) " " (32,000)" Other gains and losses " 5,000 " "Gain on sale of securities (includes $4,000 accumulated other comprehensive income reclassifications for unrealized net gains on available-for-sale debt securities) " " 4,000 " Income from operations before tax " 99,500 " "Income tax expense (includes ($1,750) income tax expense from reclassification items)" " (24,875)" Net income " $74,625 "

##### [220-10-55-18](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-18)

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This Subtopic requires that an entity determine [reclassification adjustments](https://asc.understandingaccounting.org/glossary/r/#reclassification-adjustments "Adjustments 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 each component of other comprehensive income. An entity may present those adjustments out of accumulated other comprehensive income on the face of the statement in which other comprehensive income is presented, or it may disclose reclassification adjustments in the notes to the financial statements. Paragraphs

[220-10-45-15 through 45-17](https://asc.understandingaccounting.org/asc/220/10/#220-10-45-15)

provide the guidance on reclassification adjustments. Example 1 (paragraphs

[220-10-55-7 through 55-9](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-7)

) illustrates the reclassification presentation relating to unrealized gains or losses on securities and amortized prior service costs.

##### [220-10-55-19](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-19)

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The following Case illustrates the calculation of reclassification adjustments for available-for-sale debt securities under paragraphs

[320-10-50-1 through 50-5](https://asc.understandingaccounting.org/asc/320/10/#320-10-50-1)

. It is intended as an illustration only; it does not represent an actual situation:

1.  a
    
    [Subparagraph superseded by Accounting Standards Update No. 2016-01](https://asc.understandingaccounting.org/updates/asu-2016-01/).
    
2.  b
    
    Available-for-sale debt securities (Case B).

##### [220-10-55-20](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-20)

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Case B involves a nonpublic entity that follows the practice of recognizing all unrealized gains and losses on available-for-sale debt securities in other comprehensive income before recognizing them as realized gains and losses in net income. Therefore, the before-tax amount of the reclassification adjustment recognized in other comprehensive income is equal to, but opposite in sign from, the amount of the realized gain or loss recognized in net income.

##### [220-10-55-21](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-21)

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[Paragraph superseded by Accounting Standards Update No. 2016-01](https://asc.understandingaccounting.org/updates/asu-2016-01/).

##### [220-10-55-22](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-22)

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[Paragraph superseded by Accounting Standards Update No. 2016-01](https://asc.understandingaccounting.org/updates/asu-2016-01/).

##### [220-10-55-23](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-23)

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[Paragraph superseded by Accounting Standards Update No. 2016-01](https://asc.understandingaccounting.org/updates/asu-2016-01/).

##### [220-10-55-24](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-24)

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The available-for-sale interest-bearing debt securities (bonds) in this Case were purchased at a premium to yield 6.5 percent. Interest income is included in net income based on the historical yield, and the bonds decline in fair value during the first two years in which they are held.

##### [220-10-55-25](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-25)

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On December 31, 1995, registration of Micki Inc.'s 8-year, 8 percent debentures, interest payable annually, became effective and the entire issue of $10,000,000 was sold at par immediately. At the end of each of the next four years, the closing prices and the related market interest rates to maturity were as follows.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-B22827EB-BFE1-4CFE-90AE-D10AD8C6E56E-low.gif)
    
    December 31 Price ($000) Yield (%) 1996 $102.6 7.5 1997 107.3 6.5 1998 96.1 9.0 1999 92.2 10.5

##### [220-10-55-26](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-26)

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On December 31, 1997, Entity purchased $1,000,000 of Micki Inc.'s bonds on the open market at 107.3 and classified them as available for sale. Entity continued to hold the bonds until December 31, 1999, at which time they were sold at 92.2. Entity prepared the following schedules in relation to the bonds.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-64AD617F-655D-4C62-B6B1-A3922C7C0DD2-low.gif)
    
    Cost-Based Carrying Amount, Interest Income, and Premium Amortization (a) (b) (c) (d) (e) Beginning Cash Interest Interest Premium Ending Carrying Received Income Amortization Carrying Year Value \[8% × par\] \[(a) × 6.5%\] \[(b) - (c)\] Value \[(a) - (d)\] 1997 $1,073,000 1998 $1,073,000 $80,000 $69,745 $10,255 1,062,745 1999 1,062,745 80,000 69,078 10,922 1,051,823
    
-   ![](https://asc.understandingaccounting.org/asc-img/GUID-06B5FD39-8B2A-4A6E-821B-C7C626FF6329-low.gif)
    
    Calculation of Before-Tax Holding Loss (a) (b) (c) (d) (e) Year Ended Ending Change Holding Ended Carrying Fair in Fair Premium Loss 31-Dec Value Value Value Amortization \[(c) + (d)\] 1997 $1,073,000 $1,073,000 $- 1998 1,062,745 961,000 (112,000) $10,255 $(101,745) 1999 1,051,823 922,000 (39,000) 10,922 (28,078)
    
-   ![](https://asc.understandingaccounting.org/asc-img/GUID-BE152534-F17A-4CB6-8B17-A7A3259D9979-low.gif)
    
    Net-of-Tax Holding Losses (Assume a Tax Rate of 30 Percent) Before Tax Income Tax Net of Tax Holding losses recognized in other comprehensive income: Year ended December 31, 1998 $(101,745) $30,523 $(71,222) Year ended December 31, 1999 (28,078) 8,423 (19,655) Total loss $(129,823) $38,946 $(90,877)
    
-   ![](https://asc.understandingaccounting.org/asc-img/GUID-C1B2BB1A-C84F-44B4-8D95-8B217BD50015-low.gif)
    
    Amounts Reported in Net Income and Other Comprehensive Income for the Years Ended December 31, 1998 and December 31, 1999 1998 1999 Net income: Interest income $69,745 $69,078 Loss on sale of bonds (129,823) Income tax (expense) benefit (20,923) 18,223 Amounts realized in net income 48,822 (42,522) Other comprehensive income: Holding loss arising during period, net of tax (71,222) (19,655) Reclassification adjustment, net of tax 90,877 Net (loss) gain recognized in other comprehensive income (71,222) 71,222 Total impact on comprehensive income $(22,400) $28,700

##### [220-10-55-27](https://asc.understandingaccounting.org/asc/220/10/#220-10-55-27)

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Source downloaded (UTC): 2026-09-09T23:03:37.578Z to 2026-09-09T23:03:37.578Z

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The following before-tax entries would be made to record the purchase, accrue interest (using the effective interest method based on cost), recognize the change in fair value, and record the sale.

-   ![](https://asc.understandingaccounting.org/asc-img/GUID-DB490104-49F2-4471-A326-305C473D23A0-low.gif)
    
    December 31, 1997: Investment in bonds $1,073,000 Cash $1,073,000 To record purchase of bond December 31, 1998: Cash 80,000 Investment in bonds 10,255 Interest income (to earnings) 69,745 To record interest income on the bond, amortize the premium, and record cash received Unrealized holding loss (to other comprehensive income) 101,745 Investment in bonds 101,745 To adjust carrying amount of bond to fair value Accumulated other comprehensive income 101,745 Unrealized holding loss 101,745 Interest income 69,745 Retained earnings 69,745 To close nominal accounts to real accounts at year-end December 31, 1999: Cash 80,000 Investment in bonds 10,922 Interest income (to earnings) 69,078 To record interest income on the bond, amortize the premium, and record cash received Unrealized holding loss (to other comprehensive income) 28,078 Investment in bonds 28,078 To adjust carrying amount of bond to fair value Accumulated other comprehensive income 28,078 Unrealized holding loss 28,078 To close nominal account to real account at year-end Cash 922,000 Loss on sale of securities (to earnings) 129,823 Investment in bonds 922,000 Reclassification adjustment (to other comprehensive income) 129,823 To record sale of bond Reclassification adjustment 129,823 Accumulated other comprehensive income 129,823 Retained earnings 60,745 Interest income 69,078 Loss on sale of securities 129,823 To close nominal accounts to real accounts at year-end