Current uncertainty over tariff policy changes and the potential for additional retaliatory actions creates several financial reporting considerations. All entities should consider the disclosure requirements under FASB Accounting Standards Codification (ASC) 275, Risks and Uncertainties, and ASC 855, Subsequent Events. Securities and Exchange Commission registrants should also consider the adequacy of their disclosures under Regulation S-K item 105, Risk Factors, and Regulation S-X Item 303, Management’s Discussion and Analysis.
As new tariff policies are implemented, entities with significant import or export activity subject to those tariffs are likely to see impacts to their cost structure and revenue streams, which may impact the inputs to models used to develop various accounting estimates.
Our accounting brief highlights some of the financial reporting implications associated with the intricacies of evolving tariffs that entities should consider both for the current reporting period and beyond.
