Yes, a statement of earnings is the same as an income statement. Both titles describe the same financial report: a summary of a company’s revenues, expenses, and net profit or loss over a specific period, prepared under the same accounting rules. The name on the top of the page changes with company preference and industry convention, but the content and legal significance do not.
Why the Same Report Has More Than One Name
U.S. Generally Accepted Accounting Principles, maintained by the Financial Accounting Standards Board, do not require a single title for this report. Companies pick the label that fits their tradition or industry. A tech company might call it a statement of operations. A consumer goods manufacturer might call the identical report a statement of earnings or an income statement.
The Securities and Exchange Commission treats these titles interchangeably. Public companies filing annual reports on Form 10-K under Section 13(a) of the Securities Exchange Act of 1934 must include financial statements that comply with SEC rules whatever the specific name used for the income report.1Cornell Law School. Securities Exchange Act of 1934 Nothing in the legal treatment of the data depends on which title appears at the top.
Other Names You May See for the Same Report
Depending on the type of organization, the industry, or the accounting framework it follows, the same document can appear under several other titles:
- Profit and loss statement, or P&L, the most common alternative among small business owners and private contractors.
- Statement of operations, frequently used by larger corporations and in SEC filings.
- Statement of revenue and expense, common among nonprofits, which typically avoid the words “income” or “earnings” because they aren’t profit-driven.
- Statement of comprehensive income, used by companies following International Financial Reporting Standards. This version includes items such as unrealized investment gains that may not appear on a standard U.S. income statement.
Companies outside the United States that follow IFRS will see another naming shift starting in 2027, when IFRS 18 replaces the current IAS 1 standard for presenting financial statements. Every version of the report answers the same question: did the business make or lose money during the period?
What the Report Contains, Whatever It’s Called
The line items are consistent from one title to the next. The report generally moves from total revenue down to net income in this order:
- Revenue, often called the top line. This is total money earned from core business activities before any costs are subtracted.
- Cost of goods sold, the direct costs of producing what was sold, such as raw materials and manufacturing labor.
- Gross profit, meaning revenue minus cost of goods sold.
- Operating expenses, the indirect costs of running the business: rent, administrative salaries, marketing, research and development.
- Operating income, or gross profit minus operating expenses. This measures profitability from the core business alone.
- Non-operating items, such as interest earned on investments, interest paid on debt, or one-time gains from selling an asset.
- Income taxes. The federal corporate income tax is a flat 21% of taxable income, though deductions and state taxes affect the final amount paid.2Office of the Law Revision Counsel. 26 USC 11 – Tax Imposed
- Net income, the bottom line, meaning what remains after all expenses and taxes are subtracted from revenue.
Depreciation and amortization also appear on the statement, reflecting the gradual decline in value of physical assets like equipment and intangible assets like patents. They reduce reported income without requiring an actual cash payment during the period.
Format and Accounting Method Change the Presentation, Not the Identity
Two structural choices affect how the numbers look, but neither turns the document into a different report.
The first is the format. In the single-step format, all revenues are grouped together and all expenses are grouped together, with total expenses subtracted from total revenues in one calculation. It is simpler and works well for smaller businesses with straightforward operations. In the multi-step format, the calculation is broken into stages: first gross profit, then operating income, then net income. This approach separates operating results from non-operating items and is what most publicly traded companies use. Both formats are acceptable under GAAP, and the choice does not change the final net income figure.
The second is the accounting method. Under accrual accounting, transactions are recorded when they are earned or incurred, not when cash changes hands. A product delivered in December but paid for in January is December revenue. GAAP requires publicly traded companies to use the accrual method. Under cash accounting, revenue is recorded only when payment is received and expenses only when paid. The IRS allows businesses to use the cash method as long as their average annual gross receipts over the prior three years do not exceed $32 million.3Internal Revenue Service. Revenue Procedure 2025-32 – Inflation-Adjusted Items for 2026 Once a business crosses that threshold, it generally must switch to accrual accounting.
Neither choice changes what the document is. A statement of earnings prepared with the multi-step format on the accrual basis is the same kind of report as an income statement prepared with the single-step format on the cash basis. The title, the format, and the method are three separate decisions, and the answer to the original question does not turn on any of them: the statement of earnings and the income statement are one report.