Are there any significant changes in accounting principles that could affect the comparability of the Consolidated Statements of Cash Flows for Budget?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
We reclassified certain items within operating activities on the Consolidated Statements of Cash Flows for the years ended December 31, 2023 and 2022 to conform to the current year presentation. These reclassifications had no impact on reported net cash provided by operating activities.
Adoption of New Accounting Pronouncements
Improvements to Reportable Segment Disclosures
On January 1, 2024, as the result of a new accounting pronouncement, we adopted ASU 2023-07, "Improvements to Reportable Segment Disclosures," which amends Topic 280 primarily through enhanced disclosures about significant segment expenses. The adoption of this accounting pronouncement has resulted in incremental disclosures within the notes to our Consolidated Financial Statements.
Recently Issued Accounting Pronouncements
Improvements to Income Tax Disclosures
On January 1, 2025, as the result of a new accounting pronouncement, we adopted ASU 2023-09, "Improvements to income Tax Disclosures," which amends Topic 740 primarily through enhanced income tax disclosures, improving transparency into the factors affecting income tax expense. We expect to include certain additional income tax disclosures in the notes to our Consolidated Financial Statements as a result of the adoption of this accounting pronouncement.
Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, "Disaggregation of Income Statement Expenses," which amends Topic 220 primarily through requiring disclosures, in the notes to financial statements, about certain costs and expenses. The amendments are effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted on a prospective or retrospective basis. ASU 2024-03 becomes effective for us on January 1, 2027. We are currently evaluating the impact of the adoption of this accounting prenouncement on our Consolidated Financial Statements.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, there were some reclassifications made within operating activities on the Consolidated Statements of Cash Flows for the years ended December 31, 2023, and 2022. However, these reclassifications did not impact the reported net cash provided by operating activities. This means that while the presentation of certain items within the statement changed, the overall cash flow from operations remained consistent.
Budget also adopted ASU 2023-07, "Improvements to Reportable Segment Disclosures," effective January 1, 2024, which enhances disclosures about significant segment expenses. The adoption of this pronouncement has resulted in incremental disclosures within the notes to Budget's Consolidated Financial Statements. Additionally, Budget adopted ASU 2023-09, "Improvements to income Tax Disclosures," effective January 1, 2025, which amends Topic 740 primarily through enhanced income tax disclosures, improving transparency into the factors affecting income tax expense. Budget expects to include certain additional income tax disclosures in the notes to their Consolidated Financial Statements as a result.
In November 2024, the FASB issued ASU 2024-03, "Disaggregation of Income Statement Expenses," which amends Topic 220 primarily through requiring disclosures, in the notes to financial statements, about certain costs and expenses. The amendments are effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted on a prospective or retrospective basis. ASU 2024-03 becomes effective for Budget on January 1, 2027. Budget is currently evaluating the impact of the adoption of this accounting prenouncement on their Consolidated Financial Statements. These changes primarily affect the presentation and disclosure of financial information rather than the fundamental accounting principles affecting cash flows. Therefore, while there are changes to be aware of, the core comparability of the Consolidated Statements of Cash Flows should not be significantly impacted.