FASB Accounting Standards Update (ASU), Intangibles— Goodwill and Other —Internal-Use Software (Subtopic 350-40)

Published: Sep 14, 2025

TXCPA’s Professional Standards Committee backs the proposed ASU on internal-use software costs, supporting modernized standards, clearer guidance, simplified disclosures, and flexible adoption to improve transparency and reduce complexity.

    The Texas Society of CPAs' Professional Standards Committee (PSC) expressed support for the proposed Accounting Standards Update (ASU) on internal-use software costs, emphasizing its potential to modernize accounting practices and improve transparency. The PSC agrees with the proposed classification of capitalized software costs as investing cash outflows and supports the alignment of standards with current software development practices. They recommend further guidance on assessing "significant" performance requirements and support simplified disclosure requirements to reduce preparers' complexity. Additionally, the PSC endorses the proposed adoption methods, with flexibility for private companies to adopt at their own pace, while allowing early adoption.

    Read the full comment letter here. View TXCPA PSC comment letter here.

    Topics:

    You May be Interested in

    • Electronic Signatures: Permanently Accepted on Some Paper-File-Only Forms
      The IRS has approved the use of electronic signatures for certain forms that must still be filed on paper. This change streamlines the filing process by reducing the need for physical signatures while maintaining compliance requirements.
    • IRS Inconsistent Policy on Taxpayer Interviews
      Some IRS Revenue Agents have been requesting interviews with taxpayers even when the taxpayer has authorized representation through a valid Form 2848, Power of Attorney. Tax professionals should monitor and challenge improper interview requests.
    • Highlights from Recent TXCPA-IRS Meeting
      At the June 5, 2026, TXCPA-IRS biannual meeting, IRS representatives and tax professionals discussed key updates and emerging issues. The meeting provided an opportunity to share information and address topics affecting taxpayers and the tax profession.
    More News

    Support the Next Generation

    Donate to TXCPA scholarships and help aspiring accountants achieve their goals.

    Scholarships