As with any financial instrument, the predictive power of the financial instrument or entity is very useful as it shows the way they can be useful for people who use them to either generate reports or the people who use them to understand the reports. Research by Goncharov and Hodgson (2011) indicates that the net income model was much better in predicting cash flows and dominated the comprehensive income model. Research as early as in 1999 conducted in the United States by Dhaliwal et al (1999) indicated the same. There has hence not been much benefit from the OCI.
The single statement or two statement approach that is initiated by the other comprehensive income is not accepted by all countries without concerns. For instance, an analysis that was carried out by Cimini (2012) states that the separate statement of comprehensive income is chosen largely by around 87% of the entities, as of 2009 and 2010. However the rates of adoption varies, it was noticed that countries such as France, Germany and Italy showed a rate of adoption of nearly 88.6%, 81.6% and 91.5%. The preferences in adoption vary based on possibilities for isolation of comprehensive income components and the traditional income components. This was especially true in the case of a research conducted by Agostini and Marcon (2013). Researchers analysed an Italian listed corporate, here it was seen that the very large majority, around 90%, had decided to select the presentation of two separate income statements. However this selection was argued by authors to be the result of the accounting format that was used in the country. The accounting measurement that is used by the country is similar with their traditional system and helps those non-IFRS national competitors (Ferraro, 2011).
Researchers such as Das, and Zang (2007) present that the OCI component might not result in statistically significant implications, however the prefix of OCI values might actually be useful as a predictor. Large positive OCI values can serve as a predictor for the next period net income. In this context Australia’s adoption of the OCI should be based on detailed investigations of the concerns of its organizational entities.