GASB 96 Summary: Don’t Sweat Over SBITAs

▤ Summary

You should recognize amortization of the discount on the subscription liability as an outflow of resources (for example, interest expense) in subsequent financial reporting periods. • Record the percentage of resource outflows in the variable payment reporting time that you did not earlier include in the subscription obligation measurement. Subscription assets and liabilities should be recognized and measured based on the facts and circumstances at the beginning of the fiscal year in which the standard is implemented. A few distinctions exist between the two standards, as follows: • Capitalization of SBITAs implementation expenditures: Vendors incorporate certain costs into the subscription asset and spread throughout the contract life in the GASB 96. We know that most governmental organizations are tight on resources and are facing adoption across multiple lease accounting standards (as well as many other acronym-based projects).

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