Capitalization of Costs at Salesforce.com Harvard Case Solution & Analysis

An investor wants to invest in the software / IT company. Investor interest in the prospects of growth companies in the industry of cloud computing and the decision whether to invest in equities Salesforce.com. While the industry seems to be very attractive, concerns have been raised in the financial media for the Company's accounting policy decisions, in particular the decision to capitalize the cost of software development (self-developed intangible assets) and sales commissions. Problems have also been raised over the company's focus on indicators beyond generally accepted accounting principles. Students were asked to evaluate the company's accounting policy choices and the provision of relevant information on the company's business model, existing and proposed accounting standards (both U.S. GAAP and IFRS) and the accounting policies of competitors. After evaluation of the accounting policies, students may conclude whether any adjustments should be made to the financial statements and to determine what impact this estimate. "Hide
by Darren Henderson, Chris Sturby, Jessica Kelly Source: Richard Ivey School of Business Foundation 27 pages. Publication Date: August 22, 2012. Prod. #: W12158-PDF-ENG

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