EY Partner Mark Kronforst participated in a video interview during Nareit’s REITWISE: 2024 Law, Accounting & Finance conference, held March 19-21 in Hollywood, Florida.
Kronforst discussed the implications of the SEC’s recently issued climate disclosure rule. He highlighted the key adjustments made from the proposal, including the exclusion of Scope 3 emissions and the inclusion of materiality in the rules, providing greater flexibility to companies. He also outlined a sequential timeline for compliance based on company size and disclosure subject matter.
According to Kronforst, companies should prioritize preparations for financial statement requirements that require tracking severe weather conditions and related expenses starting January 1, 2025. “The number one item that companies should focus on is financial statement requirements… because these are the things that will probably take a lot of time and are subject to audit.”
Kronforst also addressed the FASB’s updated accounting standards on reportable segment disclosure, noting changes such as the inclusion of segment expenses and expanded requirements for single-segment companies. He highlighted the potential conflict between FASB and SEC rules regarding reporting non-GAAP measures, urging companies to seek legal advice before implementation.
