NEWS RELEASE 08/16/12
FASB Publishes Proposal for Presenting Items Reclassified Out of Accumulated
Other Comprehensive IncomeNorwalk, 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
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
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
"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
The FASB has not yet decided on an effective date but
plans to do so after seeking stakeholder comments.
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.