New Accounting Pronouncements
Improvements to Income Tax Disclosures
In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2023-09, Improvements to Income Tax Disclosures. This ASU is intended to improve the transparency and
decision usefulness of income tax disclosures primarily by enhancing consistency in the categorization and disaggregation of information included in the effective tax rate reconciliation and income taxes paid by jurisdiction. This guidance is effective for annual periods beginning after December 15, 2025. The Evergy Companies adopted ASU No. 2023-09 retrospectively and it is reflected for all periods presented. The adoption of ASU No. 2023-09 did not have a material impact on the Evergy Companies' results of operations, financial positions, or cash flows. See Note 20 for further detail on the updated presentation.
Income Statement—Reporting Comprehensive Income: Expense Disaggregation Disclosures
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income: Expense Disaggregation Disclosures. This ASU is intended to enhance income statement expense disclosures by requiring disaggregated information about specific expenses categories in commonly presented income statement expense captions. ASU No. 2024-03 is effective for annual periods beginning after December 15, 2026, and for interim periods beginning after December 15, 2027. Early adoption is permitted. The Evergy Companies are currently evaluating the disclosure impact of this ASU on their respective consolidated financial statements.
About New Standards Disclosures
New accounting standards disclosures describe recently adopted pronouncements and those not yet effective, along with management's assessment of their expected impact. This section provides an early warning system for upcoming changes to how a company reports its financial results, often years before the new rules take effect.
Key signals: when management describes a not-yet-adopted standard's impact as "material" or "still being evaluated," it signals potential significant changes to reported metrics upon adoption. Watch for standards that affect a company's core operations — for example, revenue recognition changes for software companies or lease accounting changes for retailers with large store footprints. The transition method chosen (full retrospective versus modified retrospective) affects comparability with prior periods. Companies that delay adoption to the latest permitted date may be struggling with implementation complexity. Compare the disclosed impact assessments against peers in the same industry to gauge whether management's expectations are reasonable.