Chapter 11: Internally Developed Software and R&D

In this section

• Capitalization Rules: Internal-Use vs. External Sale
  Explore the key distinctions and GAAP guidance for capitalizing software costs, whether for internal organizational use or for external sale, with illustrative vignettes and best practices.
• Differentiating Research from Development
  Learn to correctly classify and account for costs in research and development for internally developed software, including feasibility studies, prototypes, and more.
• Amortization and Technological Feasibility
  Explore key guidelines for determining technological feasibility in internally developed software projects, including proper cost tracking, capitalization rules, and post-feasibility amortization.
• Common Classification Errors
  Explore frequently tested mistakes in classifying software development costs and R&D expenditures, and learn practical tips to ensure GAAP compliance. Avoid common pitfalls around capitalization criteria and internal-use software accounting through real-world scenarios, best practices, and visual diagrams.