How do companies account for costs to create training materials that are usable over extended periods?

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Company hires a firm to prepare course materials that will be used for extended periods of time. For tax and book, are these costs capitalized and then amortized? If the materials are then used to present the course, the outside costs spent to present would then be expensed?

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Certainly check with your audit partner b/c circumstances may vary, but in a past life we have treated such materials as inventory and trasacted them in and out of inventory as product was sold and the materials went out in the box. It was simply a part of the BOM (Bill of Materials) like the hardware itself. To do this, the materials need to be measurable and meaningful in terms of value. If it's a single sheet of paper that you paid to create 5 years ago and costs 1/1000 of a cent each, I'd just expense it. So some judgment comes into play. Depending on how your auditor rules on this, you may be able to build the "NRE" or development costs into the piece part costs of the individual materials, thus "loading" that cost on top. But they may make you write it off...

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How does the company buying customized educational materials that have a long term use account for the costs expended to a third party? Capitalize and expense over a set period? Expense when paid?

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I read the original question as relating to costs incurred to provide internal training to company employees, rather than to customers.
Internal training costs should be expensed as incurred - that is, they cannot be deferred and amortized over some future period that is expected to be benefited. When, though, are costs incurred? I would say when the training takes place. Training materials would be expensed as used, and costs of outside presenters expensed when they present.
If you bulk buy materials in advance (e.g., buy 100 sets of materials in anticipation of training 50 people in each of the next 2 years), I would suggest inventorying the materials and expensing as used, but only if the amounts involved are material and you can track usage. Otherwise, just expense when purchased.

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At a high level, these costs are typically immaterial, and from a practical perspective I would expense them as incurred. If you feel they are material, you could justify writing them off over a period of time, but you need to track the materials carefully.

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