| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The accompanying unaudited interim condensed consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the accounts of the Company, its wholly-owned subsidiaries and consolidated Variable Interest Entities (“VIEs”). Investments in entities where the Company holds joint control, but not control, over the investee are accounted for using the equity method of accounting. As of September 30, 2024, the Company had no investments where it has the ability to exercise joint control. These unaudited interim condensed consolidated financial statements are stated in U.S. dollars, except where otherwise indicated. Intercompany transactions and balances have been eliminated for consolidation purposes. Substantially all net revenues and financial income, cost of net revenues and financial expenses and operating expenses, are generated in the Company’s foreign operations. Long-lived assets, intangible assets and goodwill and operating lease right-of-use assets located in the foreign jurisdictions totaled $2,405 million and $2,321 million as of September 30, 2024 and December 31, 2023, respectively. These unaudited interim condensed consolidated financial statements reflect the Company’s consolidated financial position as of September 30, 2024 and December 31, 2023. These unaudited interim condensed consolidated financial statements include the Company’s consolidated statements of income, comprehensive income and equity for the nine and three-month periods ended September 30, 2024 and 2023 and statements of cash flows for the nine-month periods ended September 30, 2024 and 2023. These unaudited interim condensed consolidated financial statements include all normal recurring adjustments that Management believes are necessary to fairly state the Company’s financial position, operating results and cash flows. Because all of the disclosures required by U.S. GAAP for annual consolidated financial statements are not included herein, these unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto for the year ended December 31, 2023, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (“SEC”) (the “Company’s 2023 10-K”). The Company has evaluated all subsequent events through the date these unaudited interim condensed consolidated financial statements were issued. The interim condensed consolidated statements of income, comprehensive income, equity and cash flows for the periods presented herein are not necessarily indicative of results expected for any future period. For a more detailed discussion of the Company’s significant accounting policies, see Note 2 to the financial statements in the Company’s 2023 10-K. During the nine-month period ended September 30, 2024, there were no material updates made to the Company’s significant accounting policies. For information regarding the change in the presentation of the statements of income, please refer to section “Change in the presentation of certain financial results and reclassification of prior year results” of Note 2 – Summary of significant accounting policies of these unaudited interim condensed consolidated financial statements. Change in the presentation of certain financial results and reclassification of prior year results Change in the presentation of certain financial results Mercado Pago Fintech platform operations have significantly evolved during the last several years, not only because of the increase in the volume of transactions but also as a result of transitioning from being a non-regulated business to a regulated business, subject to the oversight of central banks and other regulators in the various countries in which the Company operates (refer to Note 3 – Fintech Regulations to the consolidated financial statements in the Company’s 2023 10-K for further details). Many of the regulations to which the Company is subject require the Company, among other things, to maintain liquidity reserves to guarantee the funds on users’ account balances in their Mercado Pago digital accounts. Depending on the country, these reserves can be partially or totally invested. During the last several years, these new regulations, coupled with the increase in the volume of transactions, have led the Company to view interest income and other financial gains from investments of these liquidity reserves as part of the Company’s operations. Furthermore, the evolution of Mercado Pago’s activities themselves has resulted in the Company managing a significant volume of cash, cash equivalents and investments. This is due to an increase in users’ account balances in their Mercado Pago digital account managed by the Company, and an increase in the level of the Company’s indebtedness to finance those operations. As a result, these Mercado Pago’s funds, together with the financing activities, have generated a significant volume of interest income and other financial gains and interest expenses and other financial losses, respectively. The Company believes that these regulatory trends and related activities will continue and, therefore, with the goal of creating a better measure of the performance of the Company, the Company decided to reclassify and present certain financial results from “Other income (expenses)” to “Net services revenues and financial income” and “Cost of net revenues and financial expenses,” in the statement of income, starting January 1, 2024 and for all prior periods presented. The reclassified financial results are related to activities that are needed or mandatory for Mercado Pago’s operations, and consist of: ■ interest income derived from investments and cash and cash equivalents, generated as part of the treasury strategy of the fintech business and because of the different regulations that require liquidity reserves, net of sales taxes; ■ interest expense and other financing costs generated by the different sources of funding of the fintech activities; and ■ gains and losses of derivatives hedging risks related to Mercado Pago’s activities. Reclassification of prior year results According to the Accounting Standards Codification (“ASC”) 205, Presentation of Financial Statements, the Company should present in a consistent manner all periods presented within the accompanying unaudited interim condensed consolidated financial statements. Therefore, prior period balances have been reclassified for consistency with the current presentation. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s 2023 10-K. This reclassification did not have an impact on previously reported net income, earnings per share, retained earnings or other components of equity or total equity. The following tables, recast for the changes summarized above, present condensed statement of income line items affected by the revisions and reclassifications of previously reported financial statements, detailing amounts previously reported, the impact upon those line items due to reclassifications and amounts as currently revised within the financial statements: Three Months Ended March 31, 2023 Six Months Ended June 30, 2023 Nine Months Ended September 30, 2023 For the Year Ended December 31, 2023 Recast Recast As reported Reclassification Recast Recast (In millions) (In millions) (In millions) (In millions) Net service revenues and financial income $ 2,912 $ 6,133 $ 9,233 $ 486 $ 9,719 $ 13,617 Net product revenues 274 638 979 — 979 1,490 Net revenues and financial income 3,186 6,771 10,212 486 10,698 15,107 Cost of net revenues and financial expenses (1,572) (3,326) (4,961) (197) (5,158) (7,517) Gross profit 1,614 3,445 5,251 289 5,540 7,590 Operating expenses: Product and technology development (381) (749) (1,145) — (1,145) (1,831) Sales and marketing (383) (766) (1,207) — (1,207) (1,736) Provision for doubtful accounts (252) (474) (751) — (751) (1,050) General and administrative (180) (369) (565) — (565) (766) Total operating expenses (1,196) (2,358) (3,668) — (3,668) (5,383) Income from operations 418 1,087 1,583 289 1,872 2,207 Other income (expenses): Interest income and other financial gains 23 57 545 (450) 95 135 Interest expense and other financial losses (34) (83) (297) 161 (136) (174) Foreign currency losses, net (87) (269) (508) — (508) (615) Net income before income tax expense and equity in earnings of unconsolidated entity 320 792 1,323 — 1,323 1,553 Income tax expense (122) (332) (504) — (504) (569) Equity in earnings of unconsolidated entity 3 3 3 — 3 3 Net income $ 201 $ 463 $ 822 $ — $ 822 $ 987 Three Months Ended March 31, 2023 Three Months Ended June 30, 2023 Three Months Ended September 30, 2023 Three Months Ended December 31, 2023 For the year ended December 31, 2023 Recast Recast As reported Reclassification Recast Recast Recast (In millions) (In millions) (In millions) (In millions) (In millions) Net service revenues and financial income $ 2,912 $ 3,221 $ 3,419 $ 167 $ 3,586 $ 3,898 $ 13,617 Net product revenues 274 364 341 — 341 511 1,490 Net revenues and financial income 3,186 3,585 3,760 167 3,927 4,409 15,107 Cost of net revenues and financial expenses (1,572) (1,754) (1,765) (67) (1,832) (2,359) (7,517) Gross profit 1,614 1,831 1,995 100 2,095 2,050 7,590 Operating expenses: Product and technology development (381) (368) (396) — (396) (686) (1,831) Sales and marketing (383) (383) (441) — (441) (529) (1,736) Provision for doubtful accounts (252) (222) (277) — (277) (299) (1,050) General and administrative (180) (189) (196) — (196) (201) (766) Total operating expenses (1,196) (1,162) (1,310) — (1,310) (1,715) (5,383) Income from operations 418 669 685 100 785 335 2,207 Other income (expenses): Interest income and other financial gains 23 34 196 (158) 38 40 135 Interest expense and other financial losses (34) (49) (111) 58 (53) (38) (174) Foreign currency losses, net (87) (182) (239) — (239) (107) (615) Net income before income tax expense and equity in earnings of unconsolidated entity 320 472 531 — 531 230 1,553 Income tax expense (122) (210) (172) — (172) (65) (569) Equity in earnings of unconsolidated entity 3 — — — — — 3 Net income $ 201 $ 262 $ 359 $ — $ 359 $ 165 $ 987 Furthermore, the following tables, recast for the changes summarized above, present net revenues per reporting segment (which have been disaggregated by similar products and services), detailing amounts previously reported, the impact upon those line items due to reclassifications and amounts as currently revised within the financial statements for the nine and three-month periods ended September 30, 2023: Nine Months Ended September 30, 2023 As reported Brazil Mexico Argentina Other countries Total (In millions) Commerce services $ 2,615 $ 1,160 $ 727 $ 293 $ 4,795 Commerce products sales 552 212 158 23 945 Total commerce revenues 3,167 1,372 885 316 5,740 Fintech services 1,375 198 927 134 2,634 Credit revenues 808 489 502 5 1,804 Fintech products sales 15 7 3 9 34 Total fintech revenues 2,198 694 1,432 148 4,472 Total net revenues $ 5,365 $ 2,066 $ 2,317 $ 464 $ 10,212 Nine Months Ended September 30, 2023 Reclassification Brazil Mexico Argentina Other countries Total (In millions) Financial services and income $ 179 $ 63 $ 235 $ 9 $ 486 Total fintech revenues 179 63 235 9 486 Net revenues and financial income $ 179 $ 63 $ 235 $ 9 $ 486 Nine Months Ended September 30, 2023 Recast Brazil Mexico Argentina Other countries Total (In millions) Commerce services $ 2,615 $ 1,160 $ 727 $ 293 $ 4,795 Commerce products sales 552 212 158 23 945 Total commerce revenues 3,167 1,372 885 316 5,740 Financial services and income 1,554 261 1,162 143 3,120 Credit revenues 808 489 502 5 1,804 Fintech products sales 15 7 3 9 34 Total fintech revenues 2,377 757 1,667 157 4,958 Net revenues and financial income $ 5,544 $ 2,129 $ 2,552 $ 473 $ 10,698 Three Months Ended September 30, 2023 As reported Brazil Mexico Argentina Other countries Total (In millions) Commerce services $ 1,007 $ 429 $ 260 $ 100 $ 1,796 Commerce products sales 204 70 50 8 332 Total commerce revenues 1,211 499 310 108 2,128 Fintech services 487 75 344 45 951 Credit revenues 304 195 171 2 672 Fintech products sales 4 3 — 2 9 Total fintech revenues 795 273 515 49 1,632 Total net revenues $ 2,006 $ 772 $ 825 $ 157 $ 3,760 Three Months Ended September 30, 2023 Reclassification Brazil Mexico Argentina Other countries Total (In millions) Financial services and income $ 57 $ 23 $ 85 $ 2 $ 167 Total fintech revenues 57 23 85 2 167 Total net revenues and financial income $ 57 $ 23 $ 85 $ 2 $ 167 Three Months Ended September 30, 2023 Recast Brazil Mexico Argentina Other countries Total (In millions) Commerce services $ 1,007 $ 429 $ 260 $ 100 $ 1,796 Commerce products sales 204 70 50 8 332 Total commerce revenues 1,211 499 310 108 2,128 Financial services and income 544 98 429 47 1,118 Credit revenues 304 195 171 2 672 Fintech products sales 4 3 — 2 9 Total fintech revenues 852 296 600 51 1,799 Total net revenues and financial income $ 2,063 $ 795 $ 910 $ 159 $ 3,927 Use of estimates The preparation of these unaudited interim condensed consolidated financial statements in conformity with U.S. GAAP requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates are used for, but not limited to, accounting and disclosures for allowance for doubtful accounts and chargeback provisions, inventories valuation reserves, recoverability of goodwill, intangible assets with indefinite useful lives and deferred tax assets, impairment of short-term and long-term investments, impairment of long-lived assets, separation of lease and non lease components for aircraft leases, asset retirement obligation, compensation costs relating to the Company’s long term retention program, fair value of customer crypto-assets safeguarding assets and liabilities, fair value of certain loans payable and other financial liabilities, fair value of loans receivable, fair value of derivative instruments, income taxes, contingencies and determination of the incremental borrowing rate at commencement date of lease operating agreements. Actual results could differ from those estimates. Customer crypto-assets safeguarding assets and liabilities As of September 30, 2024 and December 31, 2023, the fair value of the crypto-assets held in customers’ names by third-party service providers that the Company recognized on its consolidated balance sheets for both the crypto-asset safeguarding liability and the corresponding safeguarding asset, which are included in “Customer crypto-assets safeguarding liabilities” and “Customer crypto-assets safeguarding assets,” respectively, was $81 million and $34 million, respectively, which consisted of $41 million and $18 million of Bitcoin, $14 million and $7 million of Ether, and $26 million and $9 million of other crypto-assets, respectively. For further information related to customer crypto-assets safeguarding assets and liabilities please refer to Note 2 to the consolidated financial statements in the Company’s 2023 10-K. Supplier finance programs The Company and certain financial institutions participate in a supplier finance program that enables certain of the Company’s suppliers, at their own election, to request the payment of their invoices to the financial institutions earlier than the terms stated in the Company’s payment policy. As of September 30, 2024 and December 31, 2023, the obligations outstanding that the Company has confirmed as valid to the financial institutions amounted to $404 million and $381 million, respectively. For further information related to Supplier Finance Programs please refer to Note 2 to the consolidated financial statements in the Company’s 2023 10-K. Revenue recognition Revenue recognition criteria for the services provided and goods sold by the Company are described in Note 2 to the consolidated financial statements in the Company’s 2023 10-K. The aggregate gain included in “Financial services and income” revenues arising from financing transactions and sales of financial assets, net of the costs recognized on sale of credit card receivables, is $1,274 million and $439 million for the nine and three-month periods ended September 30, 2024, respectively, and $1,055 million and $379 million for the nine and three-month periods ended September 30, 2023, respectively. Revenues recognized under ASC 606, Revenue from contracts with customers, amounted to $10,701 million and $3,895 million for the nine and three-month periods ended September 30, 2024, respectively, and $7,353 million and $2,709 million for the nine and three-month periods ended September 30, 2023, respectively. Revenues not recognized under ASC 606 amounted to $4,017 million and $1,417 million for the nine and three-month periods ended September 30, 2024, respectively, and $3,345 million and $1,218 million for the nine and three-month periods ended September 30, 2023, respectively. Contract balances Timing of revenue recognition may differ from the timing of invoicing to customers. Receivables represent amounts invoiced and revenue recognized prior to invoicing when the Company has satisfied the performance obligation and has the unconditional right to payment. Accounts receivable and credit card receivables and other means of payments are presented net of allowance for doubtful accounts and chargebacks of $43 million and $42 million as of September 30, 2024 and December 31, 2023, respectively. See Note 6 – Loans receivable, net of these unaudited interim condensed consolidated financial statements for information related to the allowance for doubtful accounts with respect to the Company’s loans receivable. Contract liabilities from contracts with customers consists of fees received related to unsatisfied performance obligations at the end of the period in accordance with ASC 606. Due to the generally short-term duration of contracts, the majority of the performance obligations are satisfied in the following months. Contract liabilities from contracts with customers as of December 31, 2023 was $51 million, of which $45 million was recognized as revenue during the nine-month period ended September 30, 2024. As of September 30, 2024, total contract liabilities from contracts with customers recognized within current other liabilities was $85 million, mainly due to fees related to classifieds advertising services billed, subscriptions and loyalty programs, shipping services and inventory sales that are expected to be recognized as revenue in the coming months. Foreign currency translation All of the Company’s foreign operations have determined the local currency to be their functional currency, except for Argentina, which has used the U.S. dollar as its functional currency since July 1, 2018. Accordingly, the foreign subsidiaries with local currency as functional currency translate assets and liabilities from their local currencies into U.S. dollars by using period-end exchange rates while income and expense accounts are translated at the average monthly rates in effect during the period, unless exchange rates fluctuate significantly during the period, in which case the exchange rates at the date of the transaction are used. The resulting translation adjustment is recorded as a component of other comprehensive income (loss). Gains and losses resulting from transactions denominated in non-functional currencies are recognized in earnings. Net foreign currency transaction results are included in the interim condensed consolidated statements of income under the caption “Foreign currency losses, net”. Argentine currency status and macroeconomic outlook As of July 1, 2018, the Company transitioned its Argentine operations to highly inflationary status in accordance with U.S. GAAP, and changed the functional currency for Argentine subsidiaries from Argentine Pesos to U.S. dollars, which is the functional currency of their immediate parent company. Argentina’s inflation rate for the nine and three-month periods ended September 30, 2024 and 2023 was 101.6% and 12.1%, and 103.2% and 34.8%, respectively. Additionally, Argentina’s average inter-annual inflation rate for the nine and three-month periods ended September 30, 2024 was 262.8% and 236.4%, respectively. The Company uses Argentina’s official exchange rate to account for transactions in the Argentine segment, which as of September 30, 2024 and December 31, 2023 was 970.50 and 808.45 Argentine Pesos, respectively, against the U.S. dollar. For the nine-month periods ended September 30, 2024 and 2023, Argentina’s official exchange rate against the U.S. dollar increased 20.0% and 97.5%, respectively. The average exchange rate for the nine-month periods ended September 30, 2024 and 2023 was 887.8 and 245.8, respectively, resulting in an increase of 261.1%. The following table sets forth the assets, liabilities and net assets of the Company’s Argentine subsidiaries and consolidated VIEs, before intercompany eliminations, as of September 30, 2024 and December 31, 2023: September 30, December 31, (In millions) Assets $ 4,083 $ 3,298 Liabilities 3,064 1,878 Net assets $ 1,019 $ 1,420 The following table provides information relating to net revenues and financial income and direct contribution (see Note 9 – Segments of these unaudited interim condensed consolidated financial statements for definition of direct contribution) for the nine and three-month periods ended September 30, 2024 and 2023 of the Company’s Argentine subsidiaries and consolidated VIEs: Nine Months Ended Three Months Ended 2024 2023 2024 2023 (In millions) (In millions) Net revenues and financial income $ 2,511 $ 2,552 $ 1,033 $ 910 Direct contribution 1,062 1,238 457 463 Argentine exchange regulations Since the second half of 2019, the Argentine government instituted exchange controls restricting the ability of companies and individuals to exchange Argentine Pesos for foreign currencies and their ability to remit foreign currency out of Argentina. An entity’s authorization request to the Central Bank of Argentina (“CBA”) to access the official exchange market to make foreign currency payments may be denied depending on the circumstances. As a result of these exchange controls, markets in Argentina developed trading mechanisms, in which an entity or individual buys U.S. dollar denominated securities in Argentina (i.e. shares, sovereign debt) using Argentine Pesos, and subsequently sells the securities for U.S. dollars, in Argentina, to access U.S. dollars locally, or outside Argentina, by transferring the securities abroad, prior to being sold (the latter commonly known as “Blue Chip Swap Rate”). The Blue Chip Swap Rate has diverged significantly from Argentina’s official exchange rate (commonly known as the exchange spread). In recent years, the Blue Chip Swap Rate has been higher than Argentina’s official exchange rate. As of September 30, 2024 and December 31, 2023, the exchange spread was 28.2% and 20.4%, respectively. As part of the exchange controls, since 2019, the Argentine government imposes a tax on the acquisition of foreign currency through the official exchange market in certain circumstances. On July 24, 2023, through the Executive Power Decree No. 377/2023, the Argentine government extended the application of this tax to the following cases: (i) certain services acquired from abroad or services rendered by foreign residents in Argentina (i.e. technical, legal, accounting, management, advertising, engineering, audiovisual services, among others), which will be subject to a 25% tax rate, (ii) freight and other transportation services for import and export of goods, which will be subject to a 7.5% tax rate; and (iii) imported goods, which will be subject to a 7.5% tax rate, with certain exemptions (such as fuels and products of the basic food basket). Later, the Decree No. 29/2023, modified the tax rate for the cases mentioned above under ii) and iii) from 7.5% to 17.5%. On September 2, 2024, the Decree No. 777/2024 reestablished the tax rate for cases ii) and iii) mentioned above from 17.5% to 7.5%. Income taxes Income taxes’ accounting policy is described in Note 2 to the consolidated financial statements in the Company’s 2023 10-K. The Company’s consolidated estimated effective tax rate for the nine and three-month periods ended September 30, 2024, as compared to the same periods in 2023, decreased from 38.1% to 23.8% and 32.5% to 23.7%, respectively, mainly as a result of (i) no foreign exchange losses recognition during the period related to the acquisition of our own common stock in the Argentine market, which was considered as a non-deductible expense, (ii) lower taxable foreign exchange gains accounted for in Argentina for local tax purposes that are not recorded for accounting purposes since, under U.S. GAAP, the Argentine operations’ functional currency is the U.S. dollar due to the highly inflationary status of the country, and (iii) higher deductions related to tax inflation adjustments in Argentina. This decrease was partially offset by the reversal of the valuation allowances in one of our Mexican subsidiaries accounted for in the third quarter of 2023. A valuation allowance is recorded when, based on the available evidence, it is more likely than not that all or a portion of the Company’s deferred tax assets will not be realized. In accordance with ASC 740, Management periodically assesses the need to either establish or reverse a valuation allowance for deferred tax assets considering positive and negative objective evidence related to the realization of the deferred tax assets. In its assessment, Management considers, among other factors, the nature, frequency and magnitude of current and cumulative losses on an individual subsidiary basis, projections of future taxable income, the duration of statutory carryforward periods, as well as feasible tax planning strategies, which would be employed by the Company to prevent tax loss carryforwards from expiring unutilized. Knowledge-based economy promotional regime in Argentina In August 2021, the Under Secretariat of Knowledge Economy issued the Disposition 316/2021 approving MercadoLibre S.R.L.’s application for eligibility under the knowledge-based economy promotional regime, established by the Law No. 27,506 and complemented by Argentina’s Executive Power Decree No. 1034/2020, Argentina’s Ministry of Productive Development’s Resolution No. 4/2021 and the Under Secretariat of Knowledge Economy’s Disposition No. 11/2021. On September 13, 2024, Argentina´s Secretariat of Entrepreneurs and Small and Medium Enterprises and Knowledge-Based Economy issued Resolution 267/2024, reducing the aggregate cap on base salaries used to calculate the tax credit bond to which companies that qualify for the regime are entitled from 40 million Argentine pesos to 5 million Argentine pesos; the tax credit bond represents 70% of the Company´s social security contributions for those employees whose jobs are related to the promoted activities, with a salary cap which has been reduced to the indicated limit. MercadoLibre S.R.L uses the tax credit bond to offset federal taxes. As a result, the Company recorded an income tax benefit of $6 million and $1 million, and $35 million and $14 million during the nine and three-month periods ended September 30, 2024 and 2023, respectively. The aggregate per share effect of the income tax benefit amounted to $0.13 and $0.03, and $0.69 and $0.27 for the nine and three-month periods ended September 30, 2024 and 2023, respectively. Furthermore, the Company recorded a social security benefit of $31 million for the nine-month period ended September 30, 2024, and $49 million and $16 million during the nine and three-month periods ended September 30, 2023, respectively. For the three-month period ended September 30, 2024, the Company recorded a social security benefit of $11 million and a negative adjustment of $12 million due to the retrospective impact of the aforementioned Resolution 267/2024. Fair value option applied to certain financial instruments Under ASC 825, U.S. GAAP provides an option to elect fair value with impact on the statement of income as an alternative measurement for certain financial instruments and other items on the balance sheet. The Company has elected to measure certain financial assets at fair value with impact on the statement of income for several reasons including to avoid the mismatch generated by the recognition of certain linked instruments / transactions, separately, in the interim condensed consolidated statements of income and interim condensed consolidated statements of comprehensive income and to better reflect the financial model applied for selected instruments. The Company’s election of the fair value option applies to: i) foreign government debt securities, and ii) U.S. government debt securities. Recently Adopted Accounting Standards As of the date of issuance of these unaudited interim condensed consolidated financial statements there were no accounting pronouncements recently adopted by the Company. Recently issued accounting pronouncements not yet adopted On November 27, 2023, the FASB issued the ASU 2023-07 “Segment Reporting (Topic 280)—Improvements to Reportable Segment Disclosures”. The amendments in this update improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The guidance should be applied retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The Company will adopt this guidance in the fourth quarter of 2024 and provide the new disclosures that the adoption of this accounting pronouncement requires. On December 14, 2023, the FASB issued the ASU 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”. The amendments in this update provide more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information, requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. The other amendments in this update improve the effectiveness and comparability of disclosures by adding disclosures of pretax income (or loss) and income tax expense (or benefit) and removing disclosures that no longer are considered cost beneficial or relevant. The amendments are effective for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The guidance should be applied on a prospective basis while retrospective application is permitted. The Company is assessing the effects that the adoption of this accounting pronouncement may have on its financial statements. On November 4, 2024, the FASB issued the ASU 2024-03 “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”. The amendments in this update improve financial reporting by requiring disclosure of additional information about certain costs and expenses in the notes to financial statements at interim and annual reporting, such as the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization included in each relevant expense caption; a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively; the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expense |
