Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2020

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

Reference Rate Reform

In March 2020, the Financial Accounting Standards Board issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU temporarily provides optional expedients and exceptions for applying existing guidance to contract modifications, hedging relationships and other transactions that are expected to be affected by reference rate reform. The ASU was effective upon its issuance and will remain in effect for all contract modifications and hedging relationships entered into through December 31, 2022. The Company elected the expedient for cash flow hedges to assert the probability of the hedged forecasted transaction under Topic 815: Derivatives and Hedging, regardless of any expected modification in terms related to reference rate reform. This election did not have an impact to the Company’s Consolidated Financial Statements. As the Company begins modifying contracts impacted by reference rate reform, the other optional expedients will be evaluated for impact on the Consolidated Financial Statements.

Measurement of Credit Losses on Financial Instruments

On January 1, 2020, the Company adopted and applied ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) using the modified retrospective approach. Topic 326 introduced a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables, which is reflected in the Company’s policies. The adoption of Topic 326, as well as the adjustment to retained earnings for the cumulative effect, was not significant to the Company's Consolidated Financial Statements.