Xcel CFA Series

Financial Reporting and Analysis

Reading 25
Comprehensive Income
Describe, calculate, and interpret comprehensive income.

From this sheet you will know about the components of comprehensive
income and other comprehensive income. CFA institute loves to test
candidate on this topic, so you should expect at least two questions from thic
topic.

In Xcel CFA Series you learn important CFA concept by solving a problem in
MS Excel.

To download more of Xcel CFA Series spreadhseets please visit our website.

Contact Us:
+1 347 647 9001
help@edupristine.com
www.edupristine.com

Pristine
CFA Institute, CFA, and Chartered Financial Analyst are trademarks owned by CFA Institute.
CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine.
Analysis

nsive income.

mponents of comprehensive
CFA institute loves to test
ct at least two questions from thic

concept by solving a problem in

adhseets please visit our website.

Question

Selected financial data of a company is given below. Calculate comprehensive

income (CI) and other comprehensive income (OCI) using the same.

Net Income 2,500

Unrealised loss from foreign currency translation (150)
Dividends received from available- for- sale securities 100
Dividends paid (150)
Reacquired common stock (200)
Realised gain on the sale of equipment 100
Unrealised gain from the cash flow hedge 250
Unrealised loss from available-for-sale-securities (160)
*All numbers are in $ million unless mentioned otherwise

Options CI OCI
A 2,440 (60)
B 2,540 (60)
C 2,390 90
Solution

All numbers are in $ million unless mentioned otherwise

Comprehensive Income Calculation
Net Income 2,500
Unrealised loss from foreign currency translation (150)
Comprehensive
ComprehensiveIncome
Incomeisi
Unrealised gain from the cash flow hedge 250 distribution
distributionfor
foraareportin
reportin
Unrealised loss from available-for-sale-securities (160) Other
Othercomprehensive
comprehensiveinc inc
Comprehensive Income 2,440 recognize
recognizedirectly
directlyin
inthe
theb

Other Comprehensive Income Calculation

Unrealised loss from foreign currency translation (150)
Unrealised gain from the cash flow hedge 250 Transactions
Transactionsthat
thatare
areincl
inc
Foreign
Foreigncurrency
currencytranslati
transla
Unrealised loss from available-for-sale-securities (160) Adjustments
Adjustmentsfor
forminimum
minimu
Other Comprehensive Income (60) Unrealized
Unrealizedgains
gainsand
andloss
los
Unrealized
Unrealized gains andloss
gains and los
Comprehensive
ComprehensiveIncome
Incomeisisthe
thetotal
totalchange
changein inowners
ownersequity
equityexcept
exceptfor
forowner
ownercontributions
contributionsand
and
distribution
distributionfor
foraareporting
reportingperiod.
period.ItItisisthe
thesum
sumofofnet
netincome
incomeand
andother
othercomprehensive
comprehensiveincome.
income.
Other
Othercomprehensive
comprehensiveincome
incomeincludes
includesthe thetransactions
transactionsthat
thatbypass
bypassthe
theincome
incomestatement
statementand
and
recognize
recognizedirectly
directlyin
inthe
thebalance
balancesheet.
sheet.

Transactions
Transactionsthat
thatare
areincluded
includedininother
othercomprehensive
comprehensiveincome
incomeare:
are:
Foreign
Foreigncurrency
currencytranslation
translationgains
gainsand
andlosses
losses
Adjustments
Adjustmentsfor
forminimum
minimumpension
pensionliability
liability
Unrealized
Unrealizedgains
gainsand
andlosses
lossesfrom
fromthe
thecash
cashflow
flowhedging
hedgingderivatives
derivatives
Unrealized
Unrealized gains and losses from available-for-salesecurities
gains and losses from available-for-sale securities