# ASC 220-20-55: Income Statement—Reporting Comprehensive Income — Unusual or Infrequently Occurring Items — 55 Implementation Guidance and Illustrations

Source: FASB Accounting Standards Codification, Basic View

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## ASC 220-20-55: 55 Implementation Guidance and Illustrations

[Read section](https://asc.understandingaccounting.org/asc/220/20/#55-implementation-guidance-and-illustrations)

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#### Implementation Guidance

##### [220-20-55-1](https://asc.understandingaccounting.org/asc/220/20/#220-20-55-1)

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The specific characteristics of the entity, such as type and scope of operations, lines of business, and operating policies should be considered in determining ordinary and typical activities of an entity. The environment in which an entity operates is a primary consideration in determining whether an underlying event or transaction is abnormal and significantly different from the ordinary and typical activities of the entity. The environment of an entity includes such factors as the characteristics of the industry or industries in which it operates, the geographical location of its operations, and the nature and extent of governmental regulation. Thus, an event or transaction may be unusual in nature for one entity but not for another because of differences in their respective environments. [Unusual nature](https://asc.understandingaccounting.org/glossary/u/#unusual-nature "The underlying event or transaction should possess a high degree of abnormality and be of a type clearly unrelated to, or only incidentally related to, the ordinary and typical activities of the entity, taking into account the environment in which the entity operates (see paragraph 220-20-60-1).") is not established by the fact that an event or transaction is beyond the control of management.

##### [220-20-55-2](https://asc.understandingaccounting.org/asc/220/20/#220-20-55-2)

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For purposes of this Subtopic, an event or transaction of a type not reasonably expected to recur in the foreseeable future is considered to occur infrequently. Determining the probability of recurrence of a particular event or transaction in the foreseeable future should take into account the environment in which an entity operates. Accordingly, a specific transaction of one entity might meet that criterion and a similar transaction of another entity might not because of different probabilities of recurrence. The past occurrence of an event or transaction for a particular entity provides evidence to assess the probability of recurrence of that type of event or transaction in the foreseeable future.

##### [220-20-55-3](https://asc.understandingaccounting.org/asc/220/20/#220-20-55-3)

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The following are illustrative of events or transactions that are unusual in nature or occur infrequently:

1.  a
    
    A large portion of a tobacco manufacturer's crops are destroyed by a hail storm. Severe damage from hail storms in the locality where the manufacturer grows tobacco is rare.
    
2.  b
    
    A steel fabricating entity sells the only land it owns. The land was acquired 10 years ago for future expansion, but shortly thereafter the entity abandoned all plans for expansion and held the land for appreciation.
    
3.  c
    
    An earthquake destroys one of the oil refineries owned by a large multinational oil entity.