This article was originally published on Dec. 11, 2024, and has been updated.
In response to long-standing investor requests for greater disaggregated income statement information, in November 2024 the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). Under ASU 2024-03, public business entities are required to disclose in the notes to their financial statements disaggregated information about certain costs and expenses in both annual and interim filings. The new disaggregated expense disclosures required by ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted.
Our updated Financial Reporting Insight provides an overview of the new expense disaggregation disclosure requirements, including illustrative examples, and certain items to keep in mind for 2025 reporting and beyond. This August 2025 publication is an update to the December 2024 publication and includes additional illustrative examples as well as provides further details and commentary on the new requirements and implementation considerations. It also highlights significant differences between the ASU and the applicable disclosure requirements under International Financial Reporting Standard 18, Presentation and Disclosure in Financial Statements.
