Cloud Computing Arrangements (Completed)
Date: Tuesday, July 17, 2018
Instructor: Scott Ehrlich, CPA
||11:00am Pacific Time
12:00pm Mountain Time
1:00pm Central Time
2:00pm Eastern Time
||1 hour for CPAs
What Are Accounting Challenges in Cloud Computing Arrangements
Many companies are migrating to cloud-based computing arrangements (CCAs). Under these arrangements, companies use and access software through the internet. The software is hosted by the software vendor on its own servers.
License or Service Contract?
As CCAs have grown in popularity, a number of accounting issues have surfaced. In this course, we’ll focus on the accounting decision tree that companies should apply in accounting for CCAs, including determining whether an arrangement should be accounted for as a license or service contract, and how to record the typical implementation costs associated with the initial set-up and configuration of the cloud-based software. Mr. Ehrlich will also discussed a proposed ASU that will cover cost incurred for implementation of a cloud computing contract.
Who Should Attend
CPAs in public or private practice and corporate finance staff.
- Examples of common types of cloud-computing arrangements
- Process for determining whether the CCA should be accounted for as a license or a service contract
- Identification of what types of implementation and set-up costs are eligible for capitalization
- A discussion of the proposed ASU, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract
- Apply the FASB guidelines to determine whether a CCA should be accounted for as a service contract or a license
- Describe the accounting for CCAs determined to be a service contract versus a license
- Differentiate the types of implementation costs that can be deferred and amortized versus those that have to be recorded as period expenses
NASBA Field of Study
Accounting (1 hour)