NEWS RELEASE 08/16/12

FASB Publishes Proposal for Presenting Items Reclassified Out of Accumulated Other Comprehensive Income

Norwalk, CT, August 16, 2012—The Financial Accounting Standards Board (FASB) today issued for public comment a proposed Accounting Standards Update (ASU) that is intended to improve the presentation for reclassifications out of accumulated other comprehensive income in a manner that balances the benefits to users of financial statements, without imposing significant costs to preparers of financial statements. The proposed amendments would apply to all public and private organizations, but not to not-for-profit organizations. Stakeholders are asked to provide input by October 15, 2012.

Other comprehensive income includes gains and losses that are initially excluded from net income for an accounting period. Those gains and losses are later reclassified out of accumulated other comprehensive income into net income.

The proposed ASU would require a tabular disclosure about reclassifications out of accumulated other comprehensive income, thereby presenting, in one place, information about the amounts reclassified and a road map to related financial disclosures. Currently, this information is presented throughout the financial statements under U.S. Generally Accepted Accounting Principles. As a result, there should not be significant costs incurred by preparers of financial statements.

In December of 2011, the FASB issued ASU No. 2011-12, Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05. That Update deferred only those changes required by ASU No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income (issued in July 2011), related to reclassifications, so that the FASB could further evaluate the cost/benefit of the requirements. The amendments in this proposed Update provide alternative presentation requirements on how to present reclassifications out of accumulated other comprehensive income to the requirements in Update 2011-05, which were deferred in Update 2011-12.

"Stakeholders raised concerns that certain requirements about the reclassification of items out of accumulated other comprehensive income would be costly for preparers and add unnecessary complexity to financial statements," said FASB Chairman Leslie F. Seidman. "Based on this new feedback, the Board is proposing a revised approach that will present information about other comprehensive information in a useful way that is more cost-effective."

The FASB has not yet decided on an effective date but plans to do so after seeking stakeholder comments.

Further information including the Exposure Draft and a "FASB In Focus"— a high-level summary of the proposal—is available on the FASB website at www.fasb.org.