Transitioning to the cloud or implementing new cloud computing arrangements can involve significant costs for companies, and there are implications for how these costs are accounted for.
However, there remain questions about other fact patterns and how to account for the implementation costs of cloud computing arrangements. These issues are discussed in the EY publication Applying IFRS – Accounting for cloud computing costs, published in July 2020. This publication examines how a business might account for different types of cloud computing arrangements, including the various types of implementation costs, and is intended to help companies consider the requirements of accounting standards.
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Transitioning to the cloud or implementing a cloud computing arrangement can involve significant costs for companies, and there are implications for how these costs should be accounted for. Accounting standards do not provide explicit guidance, and so businesses need to use judgement. A new EY publication examines how a business might account for different types of cloud computing arrangements and will help companies to consider the requirements of relevant accounting standards.