FASB 2025 UPDATES

The FASB issued the following updates in 2025. The information below is based on the FASB website. The ASUs can be accessed at FASB.org

ASU 2025-05—Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The amendments are effective for:

·       Annual reporting periods beginning after December 15, 2025, and

·       Interim reporting periods within those annual reporting periods.

Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance.

An entity other than a public business entity that elects the practical expedient and, if applicable, the accounting policy election after the effective date would not need to perform a preferability assessment in accordance with ASC 250-10-45-2.

ASU 2025-04—Compensation—Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Clarifications to Share-Based Consideration Payable to a Customer. The amendments are effective

·       For all entities for annual reporting periods (including interim reporting periods within annual reporting periods) beginning after December 15, 2026.

Early adoption is permitted for all entities.

ASU 2025-03—Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity. The amendments in this ASU are effective

·       For all entities for annual reporting periods beginning after December 15, 2026, and

·       Interim reporting periods within those annual reporting periods.

Early adoption is permitted as of the beginning of an interim or annual reporting period.

ASU2025-02—Liabilities (405): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 122.  The amendments in this Update are effective

·       Immediately and

·       On a fully retrospective basis to annual periods beginning after December 15, 2024.

ASU 2025-01—Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. The amendments in this ASU are effective for

·       Annual reporting periods beginning after December 15, 2026, and

·       Interim reporting periods within annual reporting periods beginning after December 15, 2027.

Early adoption is permitted.