S&P Global Inc. (together with its consolidated subsidiaries, “S&P Global,” the “Company,” “we,” “us” or “our”) is a provider of credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity, automotive and engineering markets.

Our operations consist of six reportable segments: S&P Global Market Intelligence (“Market Intelligence”), S&P Global Ratings (“Ratings"Ratings”), S&P Global Commodity Insights (“Commodity Insights” ),), S&P Global Mobility (“Mobility” ),), S&P Dow Jones Indices (“Indices” ) and S&P Global Engineering Solutions (“Engineering Solutions” ).).

In the opinion of management, all normal recurring adjustments considered necessary for a fair statement of the results of the interim periods have been included. The operating results for the three and nine months ended September 30, 2022March 31, 2023 are not necessarily indicative of the results that may be expected for the full year.

On an ongoing basis, we evaluate our estimates and assumptions, including those related to revenue recognition, business combinations, allowance for doubtful accounts, valuation of long-lived assets, goodwill and other intangible assets, pension plans, incentive compensation and stock-based compensation, income taxes, contingencies and redeemable noncontrolling interests. Since the date of our Form 10-K, there have been no material changes to our critical accounting policies and estimates.

Contract assets include unbilled amounts from when the Company transfers service to a customer before a customer pays consideration or before payment is due. As of September 30, 2022March 31, 2023 and December 31, 2021,2022, contract assets were $74$77 million and $9$60 million, respectively, and are included in accounts receivable in our consolidated balance sheets.

We record unearned revenue when cash payments are received in advance of our performance. The increase in the unearned revenue balance at September 30, 2022March 31, 2023 compared to December 31, 20212022 is primarily driven by cash payments received in advance of satisfying our performance obligations, partially offset by $1.5$1.1 billion of revenues recognized that were included in the unearned revenue balance at the beginning of the period.

Remaining performance obligations represent the transaction price of contracts for work that has not yet been performed. As of September 30, 2022,March 31, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $4.1$4.5 billion. We expect to recognize revenue on approximately half and three-quarters of the remaining performance obligations over the next 12 and 24 months, respectively, with the remainder recognized thereafter.

We do not disclose the value of unfulfilled performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts where revenue is a usage-based royalty promised in exchange for a license of intellectual property.

We recognize an asset for the incremental costs of obtaining a contract with a customer if we expect the benefit of those costs to be longer than one year. We have determined that the costs associated with certain sales commission programs are incremental to the costs to obtain contracts with customers and therefore meet the criteria to be capitalized. Total capitalized costs to obtain a contract were $148$184 million and $137$175 million as of September 30, 2022March 31, 2023 and December 31, 2021,2022, respectively, and are included in prepaid and other current assets and other non-current assets on our consolidated balance sheets. The capitalized asset will be amortized over a period consistent with the transfer to the customer of the goods or services to which the asset relates, calculated based on the customer term and the average life of the products and services underlying the contracts which has been determined to be approximately 5 years. The expense is recorded within selling and general expenses.

We expense sales commissions when incurred if the amortization period is one year or less. These costs are recorded within selling and general expenses.

The Company holds an investment in a 50/50 joint venture arrangement with shared control with CME Group that combined each of the company’s post-trade services into a new joint venture, OSTTRA. The joint venture provides trade processing and risk mitigation operations and incorporates CME’s optimization businesses (Traiana, TriOptima, and Reset) and the Company’s MarkitSERV business. The combination is intended to increase operating efficiencies of both the company’s businessbusinesses to more effectively service clients with enhanced platforms and services for OTC markets across interest rate, FX, equity, and credit asset classes.

The components of other income,expense (income), net for the periodsthree months ended September 30March 31 are as follows:

In February of 2022, we completed the previously announced sale of OPIS to News Corp for $1.150 billion in cash. We did not recognize a gain on the sale of OPIS.

The effective income tax rate was 17.6%17.9% and 25.8%30.4% for the three and nine months ended September 30, 2022, respectively, and 19.9% and 22.8% for the three and nine months ended September 30, 2021, respectively. The decrease in the three months ended September 30,March 31, 2023 and March 31, 2022, was primarily due to mix of income by jurisdiction.respectively. The increase in ninehigher rate for the three months ended September 30,March 31, 2022 was primarily due to the tax charge on merger related divestitures and deal related non-deductible costs.

At the end of each interim period, we estimate the annual effective tax rate and apply that rate to our ordinary quarterly earnings. The tax expense or benefit related to significant unusual or infrequently occurring items that will be separately reported or reported net of their related tax effect, and are individually computed, is recognized in the interim period in which those items occur. In addition, the effect of changes in enacted tax laws or rates or tax status is recognized in the interim period in which the change occurs.

The Company is continuously subject to tax examinations in various jurisdictions. As of September 30, 2022March 31, 2023 and December 31, 2021,2022, the total amount of federal, state and local, and foreign unrecognized tax benefits was $206$236 million and $147$223 million, respectively, exclusive of interest and penalties. We recognize accrued interest and penalties related to unrecognized tax benefits in interest expense and operating-related expense, respectively. As of September 30, 2022March 31, 2023 and December 31, 2021,2022, we had $35$42 million and $24$38 million, respectively, of accrued interest and penalties associated with unrecognized tax benefits. Based on the current status of income tax audits, we believe that the total amount of unrecognized tax benefits may decrease by approximately $19$20 million in the next twelve months as a result of the resolution of local tax examinations.