In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign), and (3) the income tax expense or benefit from continuing operations (separated by federal, state and foreign). This update also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. The amendments in ASU No. 2023-09 are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. We expect the adoption of this guidance will modify our disclosures, but we do not expect the ASU will have a material impact on our consolidated financial statements.
In March 2024, the SEC issued its final climate disclosure rules, which require the disclosure of climate-related information in annual reports and registration statements. The rules require disclosure in the audited financial statements of certain effects of severe weather events and other natural conditions above certain financial thresholds, as well as amounts related to carbon offsets and renewable energy credits or certificates, if material. Disclosure requirements will begin phasing in for fiscal years beginning on or after January 1, 2025. On April 4, 2024, the SEC determined to voluntarily stay the final rules pending certain legal challenges. On March 27, 2025, the SEC voted to end its defense of the climate disclosure rules, and on April 24, 205, the U.S. Eighth Circuit Court of Appeals ordered the litigation to be held in abeyance and directed the SEC to indicate within 90
days whether the SEC will reconsider or review the climate disclosure rules. On July 23, 2025, the SEC filed a status report with the court, requesting it to terminate the abeyance and resolve the merits of the challenge to the climate disclosure rules. We continue to monitor for any updates and evaluate the impact of the new rules on the disclosures to our consolidated financial statements.
Recently adopted accounting pronouncements
In November 2023, FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. In addition, the amendments enhance interim disclosure requirements, clarify segment disclosure requirements for entities with a single reportable segment, and contain other disclosure requirements. The Company adopted ASU 2023-07 for the fiscal year ended June 30, 2025, with retrospective application to all periods presented in these financial statements. See Note 18, “Segment Information.”