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4.1 ERMUSR 11-12-2019
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4.1 ERMUSR 11-12-2019
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City Government
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ERMUSR
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11/12/2019
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• Cost to develop or obtain software that allows for access or conversion of old data <br /> by new information systems. <br /> Note: Upgrades and enhancements should be capitalized only to the extent that they <br /> increase the functionality of the product. <br /> Leased Equipment <br /> Equipment should be capitalized if the lease agreement meets any one of the following <br /> criteria: <br /> • The lease transfers ownership of the property to the lessee by the end of the lease <br /> term <br /> • The lease contains a bargain purchase option. <br /> • The lease term is equal to 75%or more of the estimated economic life of the <br /> leased property <br /> • The present value of the minimum lease payments at the inception of the lease, <br /> excluding executory costs, equals at least 90%of the fair value of the leased asset. <br /> Leases that do not meet any of the above requirements should be recorded as an operating <br /> lease and reported in the notes of the financial statements. <br /> 9 <br /> 69 <br />
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