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ASU 2023-09 introduced new disclosure requirements for all entities, primarily related to the rate reconciliation and income taxes paid.
For public business entities (PBE), ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, making the first filing cycle an important source of practical insights. For entities other than PBEs, the guidance is effective for fiscal years beginning after December 15, 2025. Early adoption is permitted.
The updated publication is intended to help engagement teams and companies understand the disclosure requirements, implementation judgments, practical considerations, and process implications that arise in practice.
Our updated BDO publication, BDO Knows ASC 740: New Income Tax Disclosures (ASU 2023-09), offers insights and breaks down the ASU’s key provisions for all entities, including:
- Income taxes paid;
- Rate reconciliation;
- Unrecognized tax benefits;
- Other income statement disclosures;
- Interim reporting;
- Eliminated disclosures; and
- Transition and effective dates.
Other key themes include establishing and documenting categorization policies, evaluating prospective versus retrospective adoption, expanded considerations for non-PBEs, lessons learned from early adopters and identifying data and control changes needed to support the enhanced disclosures.
Have questions about how ASU 2023-09 could affect you and your business? Contact our BDO Income Tax Accounting Team today.