Cloud computing arrangements: Customer accounting for implementation costs

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In depth , PwC US Aug 30, 2018

Have a cloud computing arrangement? Know what implementation costs to capitalize? We do. See our summary of FASB's new guidance.


On August 29, 2018, the FASB issued new guidance on a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by the vendor, i.e. a service contract. Under the new guidance, customers will apply the same criteria for capitalizing implementation costs as they would for an arrangement that has a software license.

The new guidance also prescribes the balance sheet, income statement, and cash flow classification of the capitalized implementation costs and related amortization expense, and requires additional quantitative and qualitative disclosures.

To have a deeper discussion about cloud computing, contact:

Matthew Albert

Senior Manager, National Professional Services Group, PwC US


Contact us

David Schmid

IFRS & US Standard Setting Leader, National Professional Services Group, PwC US

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