Comprehensive Income
Comprehensive income combines profit or loss with other comprehensive income and requires analysis of tax, recycling, attribution, and accumulated OCI.
Understand continuing and discontinued operations, other comprehensive income, total comprehensive income, and unusual earnings patterns.
Comprehensive income and special-item reporting explain performance that cannot be understood from net income alone. Other comprehensive income records specified items outside profit or loss, while discontinued-operations presentation separates the after-tax result of a qualifying disposed component from the continuing business.
These categories answer different questions. A discontinued operation is part of net income, not an OCI category. An unusual item can remain in continuing operations. A realized gain can enter profit or loss without being operating revenue.
| Guide | Use it to answer |
|---|---|
| Continuing Operations | Which income and expenses remain after qualifying discontinued results are separated? |
| Discontinued Operation | Does a disposal satisfy the framework’s significance criteria, and how is its after-tax result presented? |
| Comprehensive Income | How do profit or loss and OCI combine after tax, reclassification, parent attribution, and noncontrolling interests? |
| Total Comprehensive Income | How is the period total reconciled to net income, OCI, attribution, and equity? |
| Income Smoothing | Do estimates, transaction timing, or real business decisions make reported earnings appear unusually stable? |
| Realized Gain | How does transaction realization differ from accounting recognition, cash proceeds, and tax treatment? |
Assume a company reports $22 million of after-tax income from continuing operations and $5 million from a discontinued operation. Net income is $27 million. If OCI contains a $3 million loss, total comprehensive income is $24 million.
The discontinued amount is included in net income. The OCI loss sits outside net income but inside comprehensive income. Neither amount should be substituted for cash flow.
This section is for financial education only and does not provide accounting, audit, tax, legal, transaction, valuation, securities, or investment advice.
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Comprehensive income combines profit or loss with other comprehensive income and requires analysis of tax, recycling, attribution, and accumulated OCI.
Continuing operations are the income-statement activities remaining after results that qualify as discontinued operations are presented separately.
A discontinued operation is a qualifying disposed or held-for-sale component reported separately from continuing operations. Learn IFRS and U.S. GAAP criteria.
Income smoothing reduces fluctuations in reported earnings through accounting judgments or business decisions, with outcomes ranging from legitimate to misleading.
Total comprehensive income combines profit or loss with other comprehensive income for the period and excludes owner transactions.