The FASB has recently released ASU 2025-06, and it marks one of the most significant shifts in how companies account for internal-use software.
With agile and iterative development now the norm, the older, sequential model of capitalization no longer reflected technological reality. ASU 2025-06 modernizes the standard by:
š¹ Removing stage-based capitalization rules
š¹ Introducing clarity on probable-to-complete threshold
š¹ Requiring evaluation of Significant Development Uncertainty (SDU)
š¹ Aligning disclosures with PP&E guidance for greater consistency
At Pierag Consulting , we continue to help finance and technology leaders navigate the evolving regulatory landscape, integrating accounting clarity with digital transformation realities.
Download the full technical note for a deeper dive into scope, recognition criteria, disclosure requirements, and transition pathways.
