Special Income Statement Items

3 3 1 income statement items.

Special income statement items. As a result the amount of the gain or loss on discontinued operations would be reduced by the income tax effect note that the discontinued operations amount is shown near the. Special items are reported on the income statement and are separated out from other. Therefore the items as presented on the income statement can be removed for primary analysis without further adjustment for income taxes. A large expense or source of income that a company does not expect to recur in future years.

While the balance sheet constitutes a financial snapshot at a given point in time such as december 31 the income statement summarizes a financial movie of operational results over a period of time such as for the year ending december 31. Below is a multiple step income statement containing discontinued operations. Extraordinary income or expenses in a particular period should be separately stated in the statement of profit and loss in a manner that its impact on current profit or loss can be perceived. If this were a corporation income tax expenses would be part of the income statement.

Special income statement items cont d cumulative effect of a change in accounting principle for fiscal years beginning before 12 15 05 cumulative effect of the change shown net of tax on the income statement of the period in which change was made earlier statements not restated to reflect application of the new principle. These events were also required to be disclosed in the company s financial statement footnotes listing the nature of the events the extent of the gain or loss and the income tax ramifications.