On April 15, 2015, the FASB issued ASU 2015-05 focusing on customer’s accounting for internal-use software especially fees paid in a Cloud Computing Arrangement (CCA). From time to time, lack of explicit guidance about fees paid in a CCA has caused unnecessary costs to organizations in extra accounting fees.
The major changes in the update include eliminating the analogy to leasing guidance, adding a few more subtopics in defining software license and service contract, and some other amendments. If an organization obtains a software license for cloud computing service, it should account for that license consistently with the acquisition of any …read more
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