Financial Accounting · Statement of profit or loss and other comprehensive income

Other Comprehensive Income and Total Comprehensive Income

Updated 11 October 2026 · Fact-checked

Other comprehensive income (OCI) holds gains and losses that IFRS Accounting Standards say must bypass profit or loss. For ACCA FA the main example is a revaluation surplus on property, plant and equipment. Total comprehensive income = profit for the year + other comprehensive income. Deduct any OCI losses.

Understand Other Comprehensive Income and Total Comprehensive Income

A company's profit for the year comes from income and expenses in the statement of profit or loss. But some gains and losses are not reported there. They go straight to other comprehensive income (OCI) instead.

For the FA exam, the OCI item you must know is the revaluation surplus. When a company revalues a non-current asset under IAS 16 and the value rises above carrying amount, the increase is a gain. That gain is recognised in OCI and credited to a revaluation surplus in equity. It is not part of profit for the year, because the asset has not been sold.

Total comprehensive income is the full change in equity from the year's performance, before transactions with owners. You calculate it as profit for the year plus OCI. If OCI is a loss, you subtract it.

The statement is titled the statement of profit or loss and other comprehensive income. It can be shown as one statement or as two. Either way, profit for the year is shown first, then OCI, then the total.

Dividends paid and shares issued are not OCI. They are dealt with in the statement of changes in equity, as they are transactions with owners.

Key formulas to remember

Total comprehensive income: Total comprehensive income = Profit for the year + Other comprehensive income; If OCI is a loss, subtract it. Profit for the year is after tax.
Revaluation surplus on an asset: Revaluation surplus = Revalued amount − Carrying amount before revaluation; Applies when the revalued amount is higher. The surplus goes to OCI and then to the revaluation surplus in equity.
Closing revaluation surplus: Closing surplus = Opening surplus + Surplus arising in the year; Dividends and profit do not affect this reserve in simple FA questions.
Journal for an upward revaluation: Dr Non-current asset (cost or valuation) / Cr Revaluation surplus (OCI); Where accumulated depreciation exists, eliminate it first and restate the asset to the new value.

How to solve Other Comprehensive Income and Total Comprehensive Income questions

Use this method for any question asking for OCI, total comprehensive income or the revaluation surplus.

1Read what is asked: profit for the year, OCI, total comprehensive income or the closing reserve.
2Find the profit for the year. If you only have profit before tax, deduct income tax first.
3Identify OCI items. Look for words such as revalued, revaluation or valuation.
4Calculate the revaluation gain: new value minus carrying amount at the date of revaluation. Use carrying amount, not original cost.
5Check the direction. A gain goes to OCI. Ignore dividends and share issues, which are not OCI.
6Add OCI to profit for the year. Subtract if OCI is a loss.
7Check your answer against the options and make sure you have not mixed profit before tax with profit for the year.

Quickest way: Three-line calculation

When to use it: Use this for number entry or multiple choice questions with a single revaluation and a stated profit.

Write: Revalued amount − carrying amount = OCI gain.
Write: Profit after tax + OCI gain = total comprehensive income.
Check that depreciation up to the revaluation date has already been taken off the carrying amount.

Common mistakes in Other Comprehensive Income and Total Comprehensive Income

Putting a revaluation gain into profit for the year.
A gain feels like income, so students credit it with other income.
Fix: Remember that an unrealised revaluation gain on property, plant and equipment goes to OCI and the revaluation surplus, not profit or loss.
Calculating the surplus using original cost instead of carrying amount.
Students forget that depreciation has reduced the asset.
Fix: Always compare the new valuation with cost less accumulated depreciation at the revaluation date.
Using profit before tax in total comprehensive income.
The figure appears earlier in the question and is easy to grab.
Fix: Use profit for the year, which is after income tax, then add OCI.
Treating dividends as OCI or deducting them from total comprehensive income.
Dividends reduce equity, so students assume they belong in the statement.
Fix: Dividends are a transaction with owners. Show them in the statement of changes in equity only.
Adding an OCI loss instead of subtracting it.
Students apply the formula mechanically.
Fix: Check the sign of OCI. A loss reduces total comprehensive income.

Worked examples

Example 1

A company bought a building for $400,000. At the year end, accumulated depreciation is $80,000. The building is revalued to $450,000. Profit for the year after tax is $120,000. Calculate the revaluation surplus and total comprehensive income.

Show the solution

Carrying amount before revaluation = $400,000 − $80,000 = $320,000.
Revaluation surplus = $450,000 − $320,000 = $130,000.
This surplus is recognised in OCI.
Total comprehensive income = $120,000 + $130,000 = $250,000.

Answer: Revaluation surplus is $130,000 and total comprehensive income is $250,000.

Example 2

A company has profit before tax of $90,000 and income tax expense of $25,000. It has an opening revaluation surplus of $40,000. During the year, land is revalued from a carrying amount of $200,000 to $230,000. Calculate total comprehensive income and the closing revaluation surplus.

Show the solution

Profit for the year = $90,000 − $25,000 = $65,000.
Revaluation gain = $230,000 − $200,000 = $30,000, shown in OCI.
Total comprehensive income = $65,000 + $30,000 = $95,000.
Closing revaluation surplus = $40,000 + $30,000 = $70,000.

Answer: Total comprehensive income is $95,000 and the closing revaluation surplus is $70,000.

Exam tips

Look for the words revalued or revaluation. They signal OCI, not profit or loss.
Always work out carrying amount first. Most wrong answers use cost instead.
In multiple response questions, select only items that are genuine OCI. Dividends and share issues are not.
Check whether you are asked for profit for the year or total comprehensive income. The two differ by the OCI amount.
In number entry questions, give the figure only, with no currency symbol unless the question instructs otherwise.

Practice questions from Statement of profit or loss and other comprehensive income

Other Comprehensive Income and Total Comprehensive Income in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Other Comprehensive Income and Total Comprehensive Income: frequently asked questions

What are examples of other comprehensive income in ACCA FA?

The key example is a revaluation surplus on property, plant and equipment under IAS 16. Other OCI items exist in later study, but the FA exam focuses on this one.

What is the difference between profit for the year and total comprehensive income?

Profit for the year comes from income and expenses in profit or loss. Total comprehensive income adds OCI to that profit. The difference is the OCI amount.

Is a revaluation surplus part of profit?

No. It is recognised in OCI and held in equity as the revaluation surplus. A later downward revaluation is first set against any surplus on that same asset, through OCI. Any excess over that surplus is charged to profit or loss. On disposal, the surplus is transferred within equity to retained earnings. It is not recycled through profit or loss.

Are dividends included in total comprehensive income?

No. Dividends are distributions to owners. They appear in the statement of changes in equity, not in the statement of profit or loss and OCI.