RECENT ACCOUNTING STANDARDS
Recently adopted accounting pronouncements
In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures," which expands the disclosure requirements for income taxes, specifically related to the rate reconciliation and the income taxes paid. The update is effective for fiscal years beginning after December 15, 2024. We adopted the ASU prospectively for the year ending December 31, 2025, which required additional disclosures but did not otherwise impact our Consolidated Financial Statements. Refer to Note 9, "Income Taxes" for the inclusion of the new required disclosures.
In July 2025, the FASB issued ASU 2025-05, "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets," which introduces a practical expedient when developing reasonable and supportable forecasts as part of estimating credit losses on current accounts receivable and current contract assets the entity may assume the current conditions as of the balance sheet date do not change for the remaining life of the asset. The update is effective prospectively for fiscal years beginning after December 15, 2025, and interim periods within those annual periods, with early adoption permitted. We early adopted the ASU and applied the practical expedient prospectively for the year ending December 31, 2025. Refer to our accounting policies in Note 1, “Organization and Significant Accounting Policies” and Note 5, "Consolidated Financial Statements' Components" for activities in the balance of allowance for credit losses.
Recently issued accounting pronouncements not yet adopted
In November 2024, the FASB issued ASU 2024-03, "Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses," requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements. This update is effective prospectively for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027, with early adoption and retrospective application permitted. We are currently evaluating the impact the update will have on our Consolidated Financial Statement disclosures.
We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact to the consolidated financial statements.