An Investigation into the Feasibility and Relative Merits of Capitalizing Accounting Computer Software

Author

Joni M. Belford, Fontbonne College

Year of Award

1987

Degree

Master of Business Administration (MBA)

College

College of Business & Professional Studies

Department

Business Administration

Keywords

Financial, Computing, Standards, FASB, AcSEC, Software, Applications, IBM

Abstract

The subject of software accounting is a relatively new topic on the accounting horizon today. Although computers have been prevalent in offices for a number of years, the need to account for software has only recently come into a realm of its own. As with the birth of any new topic, the implementation process may bring forth a number of questions intrinsic only to this new procedure. In this case, it is the question of whether software should be treated as an asset or an expense. The answer may seem simple but it is one of the thorniest issues confronting the modern accounting world. Indeed, enormous sums of money are at stake for thousands of companies buying and/or producing software. Consider also the fact that many investors and lenders rely on financial statements that treat software as either an asset or an expense.

With the above focus as a foundation, it is my intention in this paper to: (1) follow and present the major accounting pronouncements and developments in order to gain a flavor for current accounting opinions, and (2) build on the historical background so as to enhance the feasibility and relative merits of capitalizing accounting computer software.

In conclusion, I reinforce that these pronouncements are steps in an accounting system. And while it may seem that the accounting body as a whole cannot agree on a consistent ruling, it is pertinent to note that this is a subject still in its infancy and will be open for discussion and be under advisement by the ruling bodies for years to come.

Document Type

Restricted Thesis

Recommended Citation

Belford, Joni M., "An Investigation into the Feasibility and Relative Merits of Capitalizing Accounting Computer Software" (1987). All Theses, Dissertations, and Capstone Projects. 576.
https://griffinshare.fontbonne.edu/all-etds/576