Some software companies argue that a proposed FASB rule on costs associated with moving to cloud platforms would be overly burdensome. Scott Ehrlich from Mind the GAAP shares his views in this Bloomberg article.
An increasing number of software providers are requiring their customers to purchase cloud-based access to the exact same software that was once offered through traditional licenses. U.S. GAAP provides guidance on how companies that license software should account for the costs of acquiring and implementing that software. But similar guidance doesn’t exist on how to account for costs associated with implementing a cloud-based arrangement. The FASB has attempted to fix this omission, and Mind the GAAP has provided feedback in a comment letter.