Decades-Old Software Accounting Rules to Get Fresh Look (1)
US accounting rulemakers agreed Wednesday to update decades-old accounting guidance for the software industry.
The Financial Accounting Standards Board agreed to start crafting new guidance for accounting and disclosure of software costs. If FASB finalizes the project, it would be the first significant update to software accounting guidance since 1998.
“These are outdated standards,” said board member Frederick Cannon. “Software was a discrete product in many ways when these were written. Today it’s a ubiquitous product, and it’s also a dynamic development product.”
Companies currently follow two judgment-laden sets of rules to figure out how to account for the costs …