What’s hidden in a published income statement?

This post was prompted by a comment from a reader. The question was where do I show the customs duty in an income statement. If we are referring to a published income statement, the answer is it is not shown. And this made me think of the items that are not visible on a published income statement. Of course, such items may be visible/shown on an internal income statement within a business.

Let me use the customs duty as an example.  If the duty is paid on items of raw material/items purchased for re-sale, the duty will be included as part of the cost/expense. On internal income statements, it probably will not be shown separately, but may have its own ledger account. On a published income statement, it will be included in cost of sales.

There are many other items which we would typically not see on an income statement, even an internal one. For example, discounts are likely to be netted off against the relevant expense; or sales of waste product against sales. However, the materiality concept may kick in, if the amount is large (material) enough to merit separate disclosure. Even if material, such items will not be seen on the income statement,  but in a note.