Gartner Research

IT Asset Capitalization Issues

Published: 16 November 2007

ID: G00152381

Analyst(s): Frank DeSalvo, Richard Ni


Many organizations want to know more about the appropriate capitalization policies for hardware and software purchases. Understanding the need for consistently applied accounting treatment provides for accurate budget preparation.

Table Of Contents
  • Overview
  • Accounting Goals of Capitalization
    • Consistency and Comparability
    • Matching
    • Materiality
  • Different Approaches Can Affect Company Financial Statements
  • More Dimensions
    • Useful Life and Depreciation Method
    • Retiring Assets
    • Tracking Assets vs. Capitalizing Assets
    • Asset Value Enhancement

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