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Bottom-line Earnings or Other Comprehensive Income. Which Earnings Number is relevant? Net Income versus Other Comprehensive Income A common source of confusion for users of financial statements is that, there appear to be two forms of profit numbers sometimes in the same presentation of income statement namely the net income and other comprehensive income (commonly called OCI). Net income is often referred to as clean surplus accounting whereas OCI is referred to as dirty surplus accounting. Under IFRS, IAS 1 Presentation of financial statements details how the statement of comprehensive income should be presented. The standard defines Other Comprehensive Income as changes in the equity of a business enterprise other than transactions with the owners and therefore not reported in the income statement. Reporting companies have a choice to present OCI either in Statement of recognized income and expense or in the statement of changes in equity directly. OCI primarily results from re-

Segment Reporting What are the key changes to segmental reporting following the issue of IFRS 8? As per 2009 financial statements, IFRS reporters across the globe applied the new standard, IFRS 8 Segmental Reporting, to report segment information. IFRS 8 introduces a ‘management approach’ to identifying and measuring the financial performance of a company’s operating segments. Reported segment information will now be based on the information used internally by management. This standard replaces IAS 14, which required firms to classify reportable segments by business (related products and services) and geography. IAS 14 distinguished between primary segments and secondary segments. Under IFRS 8, there is no longer a primary and secondary segment format. Once a company has determined that its operating segments are based on its products and services, it does not have to provide geographical segment information. Comparing IAS 14 and IFRS 8 Key Item IAS 14 IFRS 8