U.S. requirement of reporting comprehensive income does not exist in the United Kingdom, as the WPP Group does not report comprehensive income anywhere in these statements. However, WPP Group does report several changes in the recognition and valuation of assets and liabilities that are not reported currently in the consolidated profit and loss account, but likely will be in the future. Examples of these types of changes are detailed in the chapter for PepsiCo, which are reported as part of the firm's comprehensive income.
For Information: Refer to the financial statements of the WPP Group reported in Problem 1.15 as Exhibits 1.19,1. 20, and 1.21.
Required
a. Prepare a Statement of Comprehensive Income for WPP Group for Year 11. Use whatever disclosures from WPP Group's financial statements and notes you believe are appropriate to prepare the statement. Clearly label the components reported in the statement.
b. Calculate WPP Group's net income as a percent of turnover (equivalent to revenues in the United States) for Year 11. Recalculate this ratio using comprehensive income instead of net income and assess the effect of the difference between the two calculations.

"WPP Group issued common shares in Year 10 and Year 11 for the acquisition of additional agencies. The increase in the reserve represents the "share premium" (using WPP's terminology) above the "called-up share capital" (again, using WPP's terminology). The equivalent terminology in U.S. GAAP is additional paid-in capital for "share premium" and common stock, par value for "called-up share capital."

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EXHIBIT 1.19 WPP Group Consolidated Balance Sheet (amounts in millions of pounds) Problem 1.15) December 31 Year 11 Year 10 Fixed Assets Intangible Assets (Corporate Brands and Goodwill-see Note1.....5,389 4447 Tangible Assets Investments....553552 432 390 Total Fixed Assets Current Assets 56.374 5,389 £ 223 2,414 2,640 Cash at Bank and in Hand 5861:086 £3,540 £3,723 Creditors: Amounts Falling Due within One Year (Note 3) .....4322) 4.252) Net Current Liabilities 782) -(529) Total Assets Less Current Liabilities......................n 5,592 4,860 (1,712) ,280) Provisions for Liabilities and Charges (Note 4) ............(105) (98) Net Assets Excluding Pension Provision..........3,775 3,482 Creditors. Amounts Falling Due after One Year. . . . . . . . . .. . . . . . . . . . . . . . . … Net Assets ..£3.6403,394 Capital and Reserves 1,044 2,488 Share Premium Account 1,096 2,374 (48)(211) Total Capital Employed£3.640 3640 3394 EXHIBIT 1.20 WPP Group Consolidated Profit and Loss Account (amounts in millions of pounds) (Problem 1.15) Year 11 Year 10 a£20,887 13949 +"… £20,655 £13,704 20,149 13.325 E20.887 E13949 Gross Profit Other Operating Expenses .... Other Income (Expense) Items, net. Interest Payable.z1) 152) Profit on Ordinary Activities before Taxation 4E 365 Tax on Profit on Ordinary Activities Profit (Loss) on Ordinary Activities after Taxation. Minority Interest...uuuun4) u) Profit (Loss) for the Financial Year 271 244 Ordinary Dividends Retained Profit (Loss) for the Year 219206 (24) es126(1) E 285 255 52) (38)