Posted On
Posted By admin

AICPA Statements of Position (SOPs), available full-text at the links below from the University of .. , Accounting for the costs of computer software developed or obtained for internal use full-text, March 4. , Accounting for costs of. As with some other accounting standards, the conclusions in a recent AICPA AcSEC SOP In March , AcSEC issued SOP , Accounting for the Costs of. SOP is a Statement of Position, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use, issued by the American Institute of.

Author: Dom Vudora
Country: Guatemala
Language: English (Spanish)
Genre: Travel
Published (Last): 24 March 2012
Pages: 415
PDF File Size: 9.57 Mb
ePub File Size: 17.5 Mb
ISBN: 847-9-50690-520-7
Downloads: 15652
Price: Free* [*Free Regsitration Required]
Uploader: Dolkree

AcSEC recognizes that entities may develop computer software for internal use and also plan to sell, lease, or otherwise market the software to recover some costs. Select a vendor if an entity chooses to obtain software. Data conversion costs, except as noted in paragraph 21, should be expensed as incurred.

Presentation and disclosure of financial forecasts full-text. Subsequent proceeds should be recognized in revenue alcpa earned. At that time, the FASB considered aic;a the scope of that project to include costs incurred for the development of computer software for internal use.

AICPA SOP & asc Accounting For Internal-Use Software

aop Amortization and impairment of previously capitalized costs in accordance with the provisions of this SOP should result in an acceptable level of comparability and understandability. The treatment aicpz the costs of the multiple elements specified here is consistent with those provisions. The FASB concluded, however, that accounting for the costs of software used internally was not a significant problem and, therefore, decided not to expand the scope of the project.

The following costs of internal-use computer software are included in research and development and should be accounted for in accordance with the 998-1 of FASB Statement No. However, the provisions of this SOP concerning amortization and impairment should be applied to any unamortized costs capitalized prior to initial application of this SOP that continue to be reported as assets after the effective date.

SOP 98-1 — Accounting for the Costs of Computer Software

Therefore, software development costs incurred during this stage should be capitalized. This SOP is effective for financial statements for fiscal years beginning after December 15,and should be applied to internal-use computer software costs incurred in those fiscal years for all projects, including those projects in progress upon initial application of this SOP. If the customer is acquiring the software or the future right to use it, the costs of that software are accounted for in accordance with the provisions of FASB Statement No.


But I’d truly appreciate critiques and suggestions if my thought process is flawed. This SOP provides guidance on accounting for computer software that consists of more than one component or module. Internal costs incurred for upgrades and enhancements should be expensed or capitalized in accordance with paragraphs Accounting for and reporting of certain defined contribution plan investments and other disclosure matters; amendment to the AICPA audit and accounting guide, Audits of employee benefit plans full-text.

AcSEC decided that it was not necessary to characterize computer software as either intangible assets or tangible assets when similar characterizations have not been made for most other assets.

Application of the deposit, installment, and cost recovery methods in accounting for sales of real estate full-text. We went through a similar analysis this year of accounting treatment for a product we just launched. If maintenance is combined with specified upgrades and enhancements in a single contract, the cost should be allocated between the elements as discussed in paragraph 33 and the maintenance costs should be expensed over the contract period.

Entities often license internal-use software from third parties. Accounting for research and development and similar costs full-text. From Wikipedia, the free encyclopedia.

AICPA Statements of Position

Significant cost overruns d. The costs of computer software developed or obtained for aidpa use should be amortized on a straight-line basis unless another systematic and rational basis is more representative of the software’s use.

AcSEC believes and most respondents to the exposure draft agree that entities should not have the option to expense or capitalize costs of computer software developed or obtained for internal use as those sopp are incurred. Auditing insurance entities’ loss reserves, May 29, ; supplement to AICPA Audit and accounting guide, Audits of property and liability insurance companies full-text.

Reporting repurchase-reverse repurchase agreements and mortgage-backed certificates by savings and loan associations ; amendment to AICPA audit and accounting guide, Savings and loan associations full-text.


Probable does not require absolute certainty. No profit should be recognized until aggregate net proceeds from licenses and amortization have reduced the carrying amount of the software to zero.

AcSEC decided not to specify a maximum amortization period because each entity is better able to determine an appropriate useful life. Quickbooks Enterprise and deferred revenue. Questions and answers on the term reasonably objective basis and other issues affecting prospective financial statements, February 10, ; amendment to AICPA Guide for prospective financial statements full-text. Purchased or leased computer sicpa used in research and development activities where the software does not have alternative future uses b.

Accounting for developmental and preoperating costs, purchases, and exchanges of take-off and landing slots, and airframe modifications; September 30,amendment to AICPA industry audit guide, Audits of airlines full-text.

My instincts run along the lines you mention but I have lacked FASB standards to quote, so yes, I need to do more homework and will jump into that. Reporting on required supplementary information accompanying compiled or reviewed financial statements of common interest realty associations, April 23, ; amendment to AICPA audit and accounting guide, Common interest realty associations full-text.

For purposes of this SOP, computer software is ready for its intended use after all substantial testing is completed. Costs incurred prior to initial application of this SOP, whether capitalized or not, should not be adjusted to the amounts that would have been capitalized had this SOP been in effect when those costs were incurred.

This business doesn’t really seem to be 98- software Reporting pursuant to the Association for Investment Management and Research performance presentation standards full-text. Such a past practice of both using and selling computer software creates a rebuttable presumption that any software developed by that entity is intended for sale, lease, or other marketing, and thus is subject to the guidance in FASB Statement No.