Accounting for internal-use software.
Journal of Accountancy › Vol. 186 Nbr. 3, September 1998
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Summary
Accounting standards
AICPA accounting standard SOP 98-1 entitled Accounting for the Costs of Computer Software Developed or Obtained for Internal Use released in Mar 1998 needs careful examination before implementation. Determination first must be made of whether software is developed for internal use. Statement number 86 is applicable where marketing to others is planned. SOP 98-1 benefits businesses with its reasonable methods for reporting internal software costs.See the full content of this document
Extract
Accounting for internal-use software.
A reasonable way to report the benefits as assets.
As with some other accounting standards, the conclusions in a recent AICPA AcSEC SOP may seem obvious. However, things are not always as they appear. In March 1998, AcSEC issued SOP 98-1, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use, which re quires entities to capitalize certain internal-use software costs once certain criteria are met. The SOP applies to all nongovernment entities and must be adopted for fiscal years beginning after December 15, 1998, although earli...See the full content of this document
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