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Campus Administrative Training Series / Bloomington Financial and Administrative Resource Page
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Defining Item(s) as Capital Software

Activity: Defining Item(s) as Capital Software
Financial Policy: FIN-ACC-I-160, Capitalization of Software
Related Policies: FIN-ACC-I-150, Capitalization of Moveable Equipment
Additional Forms: N/A

Things to Know:

  • Operating software purchased with a computer package will be capitalized as part of the initial cost of the computer.
  • Computer package is a purchase of the main computer central processing unit and could include a monitor, keyboard, mouse and operating software.
  • Application software is canned programs that offer special functions (i.e. Harvard Graphics, LAN based user packages) and shall be capitalized as a seperate asset if the acquisition value is $5,000.00 or more and has a life greater than one year.
  • For software to be secured as capital, the correct object code must be used on the purchase order and other financial transactions. A list of object codes (income and expense) is available by contacting your campus Chart Manager (List of Chart of Account Managers) or in the KFS Object Code Reference Table.
  • For more information please contact Jennifer George, email: jmabry@indiana.edu