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What is the statement of comprehensive income?

Harold Averkamp, CPA, MBA

Definition of Statement of Comprehensive Income

The statement of comprehensive income is one of the five financial statements required in a complete set of financial statements for distribution outside of a corporation.

The statement of comprehensive income covers the same period of time as the income statement and consists of two major sections:

  • Net income (or net earnings) from the company’s income statement
  • Other comprehensive income, which consists of positive and/or negative amounts for foreign currency translation and hedges, and a few other items

The totals from each of the above sections are summed and are presented as comprehensive income.

(If a company does not have any item that meets the criteria of other comprehensive income, the statement of comprehensive income is not required.)

For a company with an item that is considered to be other comprehensive income, the statement of comprehensive income is usually a separate financial statement that is presented immediately following the income statement. (However, a company has the option to combine the income statement and the statement of comprehensive income into one continuous financial statement.)

The amount of net income will cause an increase in the stockholders’ equity account Retained Earnings, while a loss will cause a decrease.

The amount of other comprehensive income will cause an increase in the stockholders’ equity account Accumulated Other Comprehensive Income (while a negative amount will cause a decrease in Accumulated Other Comprehensive Income).

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About the Author

Harold Averkamp

For the past 52 years, Harold Averkamp (CPA, MBA) has
worked as an accounting supervisor, manager, consultant, university instructor, and innovator in teaching accounting online. He is the sole author of all the materials on

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