1. Scope SBITA defined Exemptions 2. Recognition and measurement of a SBITA Subscription liability Subscription asset Outlays other than subscription payments Disclosure requirements 3. SBITA accounting example Terms Additional costs evaluation Calculation of...
Software Accounting Articles
Your Accounting Software Vendor Got Acquired? Here’s What to Do Now.
So, the accounting software vendor you rely on for financial reporting, journal entries, and audit support was just acquired. Now what? While it might seem like business as usual at first, this kind of change can have a material impact. Here's your guide to...
Turn FinOps into a Team Sport: Optimize Cloud Costs with Cross-Functional Collaboration
Cloud spending is skyrocketing with even small to medium-sized businesses spending over a million dollars annually on cloud services. With these numbers rising, managing cloud costs has become a critical concern for IT and finance leaders. Large companies are turning...
The New Frontier of FinOps: SaaS Licensing and Usage
Introduction Since the introduction of the first commercial cloud in 2006, cloud computing has taken the business world by storm. More than 90% of organizations use the cloud today according to the latest O'Reilly Cloud Adoption Report and the costs are adding up....
Managing Software Assets Effectively in the SaaS Era
In today's fast-paced, software-driven world, managing software usage and cost is no longer a luxury—it's a necessity. The advent of SaaS (Software as a Service) has dramatically changed how organizations approach this problem, presenting new challenges and...
Software License Types, Examples, Management, & More Explained
1. What is a software license? 2. How do software licenses work? 3. Why are software licenses important? Why are EULAs important? 4. Software licenses vs. SaaS 5. Software license types and licensing models Public domain license GNU lesser general public license...
Software Decommissioning Made Easy: How Software Management Tools Streamline Access Removal
Businesses rely on a multitude of SaaS applications to drive productivity and innovation. As business needs evolve, so do the SaaS applications they use. Applications become obsolete, contracts expire, or new solutions emerge. Unfortunately, decommissioning a SaaS...
Materiality, Immateriality, and Material Misstatements in Accounting Explained
What is materiality in accounting? Materiality is the accounting concept that the more significant missing or incorrect information is to an entity, the larger impact the error or omission may have on the decision-making of users of the affected financial statements....
From Chaos to Control: A Five-Step Approach to Effective SaaS Spend Management for CFOs and Their Teams
As presented in our previous article Managing SaaS Expenditures: Key Questions for CFOs to Consider, SaaS spend management is a critical task for finance leaders, as SaaS applications can represent a significant portion of a company's IT budget. With the rapid growth...
SaaS / Software Subscription Accounting under US GAAP
1. The rise of software subscriptions Understanding popular pricing models in SaaS 2. How to account for software subscriptions What does the guidance say? 3. Financial statement impact of software subscriptions Accounting for prepaid subscriptions 4. SummaryThe rise...
Do You Know How Much Your Company Spends on Software?
1. Why software costs can be hard to pin down Lack of planning and organization Unclear lines of accountability 2. The cost of inadequate SaaS spend management 3. Who should worry about hidden software costs? 4. How SaaS spend management enables you to take control of...
Software Capitalization Rules under US GAAP and GASB
1. Software Capitalization Rules under FASB and GASB 2. Types of software Purchased software Internally-developed software Software as a Service (SaaS) 3. SummarySoftware Capitalization Rules under FASB and GASB The capitalization of software development costs was a...
Prepaid Expenses Guide: Accounting, Examples, Journal Entries, and More Explained
1. What are prepaid expenses? Prepaid expenses vs. accrued expenses 2. Accounting for prepaid expenses Accrual basis vs. cash basis Presentation on the balance sheet When do prepaid expenses hit the income statement? 3. Common examples of prepaid expenses Lease...
GASB 96 Disclosure Requirements for Governments Explained with an Example
1. Qualitative disclosures Requirements 2. Quantitative disclosures Subscription asset disclosure Outflow of resources Subscription liability disclosure and maturity analysis Future SBITA commitments Impairment loss Exemptions 3. Presentation on financial statements...
What Is a SBITA? How to Know if Your Organization Has Them
GASB Statement No. 96 What is GASB 96? Because of the increased popularity of subscription-based information technology arrangements (SBITAs) the GASB issued Statement No. 96 (GASB 96). This statement provides guidance on the accounting and financial reporting for...
May 2022 GASB Update: Statement No. 99 Explained (GASB 87 & GASB 96)
On May 9, 2022 the GASB issued Statement No. 99 Omnibus 2022 (GASB 99) providing clarification guidance on several of its recent statements, including GASB Statement No. 87 Leases (GASB 87) and GASB Statement No. 96 Subscription-Based Information Technology...
GASB 87 & GASB 96 Efficiencies: Similarities, Differences, Adoption Tips, & More
The effective date for GASB 87 has passed, but GASB 96 is just around the corner. Many companies working towards compliance with GASB 87 can save time and resources by adopting GASB 96 simultaneously. This article provides a comparison and contrast of both standards,...
GASB 51 vs. GASB 96: Similarities and Differences in Accounting Treatment
1. What is GASB 51? History of GASB 51 2. What is GASB 96? Why is GASB 96 necessary? 3. Similarities between GASB 51 and GASB 96 4. Differences between GASB 51 and GASB 96 5. Summary 6. Related articlesWhat is GASB 51? GASB Statement No. 51 Accounting and Financial...
Accounting for Service Contracts: Software Licenses & Leases
1. Accounting for leases embedded in service contracts 2. Are software licenses considered service contracts under ASC 842, IFRS 16, or GASB 87? 3. Accounting for software as a service contracts – what’s changed 4. Subscription-based information technology...
ASC 350-40: Internal-Use Software Accounting & Capitalization
1. FASB internal-use software standard 2. Effective date of ASC 350-40 3. The need for clarity Capitalizable vs. non-capitalizable 4. Updates to ASC 350-40 Capitalizable vs. non-capitalizable software costs 5. Initial measurement and subsequent measurement Initial...