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In accounting, net income represents a company’s profit or loss during a specific period, calculated as revenues minus expenses.

However, not all changes in a company's financial position are reflected in net income.

Other comprehensive income, or OCI, includes certain gains and losses excluded from net income.

Items, such as unrealized gains or losses on investments, foreign currency translation adjustments, and pension plan changes, are remeasured at the end of each reporting period.

For example, consider Gamma Corporation, which holds real estate as a long-term investment.

If the market value of this investment increases by ten thousand dollars by year-end without being sold, the unrealized gain is recorded in OCI.

This entry boosts the company’s equity without affecting net income.

Companies typically present OCI separately or alongside net income, allowing users to distinguish between core operational results and market-driven changes.

While net income reflects the company’s performance from day-to-day operations and appears as the bottom line on the income statement, OCI captures broader financial elements.

Together, they provide a more complete picture of financial health.