Recently Adopted Accounting Standards
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures. This update improves the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. The Company adopted this ASU on a prospective basis effective January 1, 2025. Refer to Note 13, Income Taxes, for the expanded disclosures required under this ASU. The adoption of this pronouncement did not have a material impact on the Company’s consolidated financial statements.
In July 2025, the FASB issued ASU No.2025-05, Financial Instruments-Credit Losses (Topic 326). This update affects the practical expedient when estimating expected credit losses on current accounts receivables and current contract assets arising from transactions under Topic 606. The guidance is effective for the Company for annual reporting periods beginning after December 15, 2025 and interim reporting periods within those annual reporting periods. The early adoption of this pronouncement did not have a material impact on the Company’s consolidated financial statements.
Recently Issued Accounting Standards Not Yet Adopted
In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses. This update improves the disclosures about a public entity’s expenses, primarily through additional disclosures of specific information about certain costs and expenses in the notes to financial statements. The guidance is effective for the Company for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and Other-Internal-Use Software (Subtopic 350-40). This update removes all references to prescriptive and sequential software development stages throughout Subtopic 350-40. The guidance is effective for the Company for annual reporting periods beginning after December 15, 2027 and interim reporting periods within those annual reporting periods. Early adoption is permitted. The Company intends to early adopt this ASU as of January 1, 2026 using prospective transition method. The Company expects that the adoption of ASU 2025-06 will result in a decrease in the amount of software costs eligible for capitalization as certain agile development activities may not meet the 'probable-to-complete' threshold as early as they did under the legacy stage-based model, particularly for projects involving novel technology.
In November 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This amendment results in a comprehensive list of interim disclosures that are required by GAAP, which includes a disclosure principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. The guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, for public business entities and for interim reporting periods within annual reporting periods beginning after December 15, 2028, for entities other than public business entities. Early adoption is permitted for all entities. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.