Recently Issued and Adopted Accounting Pronouncements and Regulatory Items

9 Months Ended

Sep. 30, 2022

Accounting Policies [Abstract]

Recently Issued and Adopted Accounting Pronouncements and Regulatory Items

Recently Issued and Adopted Accounting Pronouncements and Regulatory Items

New accounting guidance and regulatory items

In March 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides optional guidance for a limited period of time to ease the potential burden in accounting for contracts and hedging relationships affected by reference rate reform. This applies to contracts that reference LIBOR or another rate that is expected to be discontinued as a result of rate reform and have modified terms that affect or have the potential to affect the amount and timing of contractual cash flows resulting from the discontinuance of the reference rate. The new standard is currently effective and upon adoption may be applied prospectively through December 31, 2022. We are continuing to monitor for any modified or newly entered contracts and hedging relationships for accounting impacts due to reference rate reform. Currently, there are no material impacts on our consolidated financial statements related to this standard.

In September 2022, the FASB issued ASU No. 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations. This ASU enhances the transparency of supplier finance programs and their effect on working capital, liquidity, and cash flows. The new standard is effective for fiscal years beginning after December 15, 2022 (i.e. a January 1, 2023 effective date), including interim periods within those years. Early adoption is permitted. The amendments in the ASU should be applied retrospectively to all periods in which a balance sheet is presented, except for the amendment on rollforward information, which should be applied prospectively. We offer to a select group of suppliers a voluntary Supply Chain Finance (“SCF”) program with a global financial institution. The suppliers, at their sole discretion, may sell their receivables to the financial institution based on terms negotiated between them. Our obligations to our suppliers are not impacted by our suppliers’ decisions to sell under these arrangements. Agreements under these supplier financing programs are recorded within Accounts payable, trade and other in our condensed consolidated balance sheets and the associated payments are included in operating activities within our condensed consolidated statements of cash flows. The amendments in this ASU will impact disclosure requirements they do not affect the recognition, measurement, or financial statement presentation of obligations covered by our SCF programs.