Research on the Integration of Balance Sheet Approach and Income Statement Approach

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The purpose of this research is to explore a direction of an integration of two different financial reporting approaches, that is, balance sheet approach and income statement approach. We focus on both the concept which determines the timing of income recognition and the one which determines the scope of owners' equity, mainly examining accounting standards for business combinations and consolidated financial statements. We conclude from this research, in order to integrate two approaches, it is necessary to distinguish between net assets and owners' equity as well as between comprehensive income and net income and to devise an articulation of the balance sheet based on the concept of control and the income statement based on the concept of shareholders' interest.