USA Capitalization and ASC 842

Joined
Oct 3, 2023
Messages
2
Reaction score
0
Country
United States
Hello all,

I've been pondering this one awhile and have asked other sources, but I can never seem to get a straight answer (of course you never really do with accounting).

For setup, we lease all of our locations. We do not own any of the properties. Our outsourced IT company has begun an upgrade initiative that requires installation of a new framework. Most of this framework is stuff that we cannot take with us should we leave.

I'm new to the company (Private co.) and they've always capitalized these small improvements. I think that's incorrect though. To me, these are lease improvements that are funded by us.

Does anyone have any insight into this?
 

kirby

VIP Member
Joined
May 12, 2011
Messages
2,455
Reaction score
334
Country
United States
When you lease a space then make improvements to the space these are recorded as leasehold improvement assets on your books. Why do you see your situation as different?
 
Joined
Oct 3, 2023
Messages
2
Reaction score
0
Country
United States
When you lease a space then make improvements to the space these are recorded as leasehold improvement assets on your books. Why do you see your situation as different?
Mainly because of ASC 842. Would this not be something that would go towards decreasing the Right of Use Asset? I'm mainly not sure as my experience with leasehold improvements and ASC 842 is non-existent.
 

Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Members online

No members online now.

Forum statistics

Threads
11,756
Messages
27,803
Members
21,756
Latest member
Kangwa10

Latest Threads

Top