How should internally generated software be reported if stoppage occurs?
The Construction in Progress asset balance must be restated and disposed if an internally generated computer software project: • Is suspended prior to completion, or • Upon completion does not meet the $1 million capitalization threshold. Internally generated intangible assets impaired from development stoppage should be reported at the lower of carrying value or fair value. As an incomplete software project does not normally have any value, the carrying value or fair value in this scenario would not have any value and these costs should be expensed. For additional information related to impairment, see Fiscal Policy and Procedure (FPP) G.002, Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries, issued by the Comptroller’s office.
Related Questions
- My company had software development expenses; however, a final product was never used internally or marketed. Should software expenses be reported if no final product is created?
- Why would an enterprise want to use Anakam On Demand Identity rather than installing the Anakam software internally?
- How should internally generated computer software projects in progress as of Sept. 1, 2009, be reported?
