BC65 The exposure draft of 2006 proposed to allow components of ‘other recognised income and expense’ (now ‘other comprehensive income’) to be presented before tax effects (‘gross presentation’) or after their related tax effects (‘net presentation’). The ‘gross presentation’ facilitated the traceability of other comprehensive income items to profit or loss, because items of profit or loss are generally displayed before tax. The ‘net presentation’ facilitated the identification of other comprehensive income items in the equity section of the statement of financial position. A majority of respondents supported allowing both approaches. The Board reaffirmed its conclusion that components of other comprehensive income could be displayed either (a) net of related tax effects or (b) before related tax effects.

BC66 Regardless of whether a pre‑tax or post‑tax display was used, the exposure draft proposed to require disclosure of the amount of income tax expense or benefit allocated separately to individual components of other comprehensive income, in line with SFAS 130. Many respondents agreed in principle with this disclosure, because they agreed that it helped to improve the clarity and transparency of such information, particularly when components of other comprehensive income are taxed at rates different from those applied to profit or loss.