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Treatment of Fully Amortized IDS

Michelle Sanders's Profile

We have ongoing projects for internally developed software. We have never retired any of our fully amortized assets. Trying to figure out the best way, no actually trying to identify any frowned upon or incorrect methods of retiring these assets. They are fully no $$ impact. Can we retire all assets acquired in years 1 through 4? Or must it be project driven? We don't have the best records of which assets pertained to which projects. And most projects are improvements to prior projects. Any guidance/advice on how best to treat this? Thanks so much!


Kevin Roones
Title: Senior Accounting Professional
Company: In-between
(Senior Accounting Professional, In-between) |

The short answer is that you would only retire assets that are no longer used. So retiring all assets acquired in years 1 through 4 would probably not be correct. If the improvements completely replace the functionality of the prior projects then the prior projects should be written off. I would also say that it is important to keep good records on those assets that have been capitalized, for your company, your auditors and various taxing authorities.


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