Comprehensive income includes all items that impact owners’ equity but are not the result of transactions with shareowners. Some of these items are included in the calculation of net income, and some are included in other comprehensive income (OCI). Under IFRS, when comprehensive income is presented in two statements, the statement of comprehensive income begins with the profit or loss from the income statement and then presents the components of other comprehensive income. Although US generally accepted accounting principles (US GAAP) indicate a preference for this type of presentation when a single statement of comprehensive income is not presented, they permit companies to present the components of other comprehensive income in the statement of changes in equity.5
Exhibit 6 presents the statement of comprehensive income of the Volkswagen Group from its Annual Report 2009.
Exhibit 6. Statement of Comprehensive Income of the Volkswagen Group for the Period 1 January to 31 December| € million | 2009 | 2008 | |
|---|---|---|---|
| Profit after tax | 911 | 4,688 | |
| Exchange differences on translating foreign operations: | |||
| Fair value changes recognized in other comprehensive income | 917 | –1,445 | |
| Transferred to profit or loss | 57 | ||
| Actuarial gains/losses | –860 | 190 | |
| Cash flow hedges: | |||
| Fair value changes recognized in other comprehensive income | 683 | 1,054 | |
| Transferred to profit or loss | –908 | –1,427 | |
| Available-for-sale financial assets (marketable securities): | |||
| Fair value changes recognized in other comprehensive income | 200 | –330 | |
| Transferred to profit or loss | 71 | 100 | |
| Deferred taxes | 216 | 145 | |
| Share of profits and losses of equity-accounted investments recognized directly in equity, after tax | 30 | –188 | |
| Other comprehensive income | 406 | –1,901 | |
| Total comprehensive income | 1,317 | 2,787 | |
| Of which attributable to | |||
| Shareholders of Volkswagen AG | 1,138 | 3,310 | |
| Minority interests | 179 | –523 | |
Exhibit 6 shows that other comprehensive income, although smaller in absolute terms than profit after tax (net income), had a significant effect on total comprehensive income. In 2009, other comprehensive income represented approximately 31 percent of total comprehensive income and was approximately 45 percent of the size of profit after tax (net income). In 2008, other comprehensive income was negative (a loss) and was approximately 41 percent of the size of profit after tax (net income) in absolute terms. The statement of comprehensive income will be discussed in greater detail in a later reading. The next section briefly describes the statement of changes in equity.
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