Have you heard about comprehensive income statement? If not, don’t worry & watch this video by Finance Guru, Vishal Thakkar. You will know all about it.
Ladies and gentlemen boys and girls welcome back to finance tube your friend and finance guru vishal thakur is back again with yet another topic in our india’s video series and yes ladies and gentlemen today’s topic of discussion is comprehensive income statement now while typically this comprehensive income statement is not a new statement it is actually an income
Statement which replaces the pnl account but here the breadth and the depth of the statement has increased manifold times now in deus or i fara sticks are very matured approach to the entire income generation activity of an organization earlier we used to have a classification of capital revenue and operational revenue so we said that hey all your capital receipts
Will go to balance sheet and your revenue receipts will go to pmf so all the revenue items related to current tier will form a part of pnl and everything else will go to the balance sheet because that will be carried forward to the subsequent period this is a concept which we are all familiar with but now with the new pnl or let me call it statement of comprehensive
Income coming into picture we have a different story altogether so what do we have so statement of comprehensive income looks like this if you look carefully the first part of this statement looks very much like our own pmf where we have operational revenues like sales less taxes other income total revenue operating expenses office expenses factory expenses snd
Expenses and so on but after that the second part of this hansol income statement talks about oh see i which is other comprehensive income now what do you mean by other comprehensive income many are times there is a wide range of activity which is incidental to the operations of an organization in the due course of its business so all whatever incidental income
Arises most of it is non cash so let’s say fair value changes in my assets or liabilities fair value changes in my cash flow hedges changes which are notional in nature which are non-cash but yet the value is created so we are talking about all those income which is typically non-cash and it incidentally accrues to the organization in its normal course of operation
Becomes a part of other comprehensive income so we are going towards a more matured regime whereby we are saying that hey look the organization does not just create value by its cash flow and profit but there are other value creating parameters like brand or changes in the value of assets and liabilities also are actively or positively contributed by enterprise to
The society and hence it needs to be captured somewhere and so we have this new concept of other comprehensive income while to traditional accountants who are very conservative in nature would this concept would be difficult to digest but all i want to tell you is hey welcome to the new reality having said that friends yes we will take time to get accustomed to or
Used to this concept of comprehensive income and eventually we will realize that it’s a more matured way more transparent way for reporting of our stakeholders so for comprehensive income statement of changes in equity balance sheet and many more exciting topic related to india’s stay tuned to our channel and subscribe now if you haven’t done so far our channel
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Comprehensive Income Statement (CIS) | Finance Tube By Finance Tube
