FASB Could Take Up Cloud Computing Project
A cloud computing project could be in the works for the Financial Accounting Standards Board (“FASB”). During the April 4 Private Company Council meeting, most council members said they want implementation accounting for cloud computing software to be similar to the accounting for constructing on-site systems. Lining up the accounting for both would allow companies to potentially capitalize set-up costs, allowing them to postpone disclosing the expense as a long-term asset.
David Hirsch, a council member, remarked that the current cloud computing guidance is confusing. In his opinion, cloud- and on-premises software implementation expenses must be recorded similarly.