The IASB has amended two standards which are key planks in achieving its work plan, introducing new requirements on the presentation of comprehensive income and the accounting for employee benefits.
The changes had their genesis in more extensive objectives under wider projects. The changes to the presentation of other comprehensive income (OCI) were 'spun out' of the wider project on Performance Reporting, which promised a major overhaul of the way the primary financial statements were presented. The OCI ED had originally itself proposed the mandatory presentation of other comprehensive income in one financial statement, but constituent comment proved the change to be too controversial to be included in the final amendments. Instead, the amendments to IAS 1 Presentation of Financial Statements retain the 'one or two statement' approach at the option of the entity and only revise the way other comprehensive income is presented: requiring separate subtotals for those elements which may be 'recycled' (e.g. cash-flow hedging, foreign currency translation), and those elements that will not (e.g. fair value through OCI items under IFRS 9). In addition, the FASB has issued corresponding guidance with the issuance of ASU 2011-05. While the boards' new guidance essentially converges the requirements for presenting OCI, there are still differences between U.S. GAAP and IFRSs concerning (1) what items are included in comprehensive income and (2) reclassification requirements.
See full Press Release.
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