Account Codes for Intangible Assest Accounting
Changes have been made to the account codes in Oracle/PeopleSoft Finance to provide for better identification of intangible assets and related expenses. The new codes are grouped into two sets of costs: 1) small costs that will be considered operating expenses, or 2) large costs that will be considered intangible (capital) assets.
Account codes to be used for costs related to the acquisition of intangible assets are as follows:
Small Intangible Asset Related Costs Not Capitalized - Operating Expenses CHANGES (Effective 7/1/2011)
OLD ACCOUNT CODE NAME 531015 Software/Licenses Over $5,000 - Non-Capitalized Op Expense
NEW ACCOUNT CODE NAME 531015 NonCap Software/License/Maintenance
ACCOUNT CODE DEACTIVATED 531020 Software/Licenses Under $5,000 - Non-Capitalized Op Expense - This code has been deactivated - Please use Account 531015 for all non-capitalized software, regardless of dollar amount.
Other Small Intangible Asset Related Costs Not Capitalized - Operating Expenses
535205 Mineral, Water, Timber Rights - Non-Capitalized Operating Expense
535210 Copyright - Non-Capitalized Operating Expense
535215 Patent - Non-Capitalized Operating Expense
535220 Trademark - Non-Capitalized Operating Expense
535225 Website - Non-Capitalized Operating Expense (See Definitions below)
535230 Other Easement - Non-Capitalized Operating Expense
535235 Right of Way - Non-Capitalized Operating Expense
535240 Logos - Non-Capitalized Operating Expense
Large Intangible Asset Costs Capitalized - Intangible Assets
(Use the codes below if at the onset the total expenses are expected to exceed $25,000; except for Website Intangible, Internally Developed Software, and Capitalized Software which have other thresholds noted below.)
691065 Website - Intangible Asset ($50,000 threshold if internally developed, see Definitions below)
691045 Mineral, Water, Timber Rights - Intangible Asset
691070 Other Easements - Intangible Asset
691075 Right of Way - Intangible Asset
691050 Copyright - Intangible Asset
691060 Trademark - Intangible Asset
691080 Logos - Intangible Asset
691055 Patent - Intangible Asset
693030 Internally Developed Software - Intangible Asset ($50,000 threshold-See Definitions below)
693035 Capitalized Software - Intangible Asset ($5,000 threshold) (See Definitions below)
Intangible Assets - Intangible assets lack physical substance (cannot be physically touched), are non-financial in nature and the useful life extends beyond one year.
Software (Purchased) - Most purchased software is not capitalized, even if the cost exceeds $5,000, because what is usually being paid for is an annual maintenance fee or license to use the software for one year or less. Since the cost is only benefiting one year, it should be considered an operating expense and account code 531015 should be used. If what is being purchased is a perpetual license (lifetime or license for more than one year) and the cost exceeds $5,000, account code 693035 should be used and the software will be considered an intangible asset and listed on NDSU's Intangible Asset Records. In order for the NDSU Accounting Office to identify the intangible for addition to the records, the software cost must be coded to account code 693035.
Internally Developed Software - Use account code 693035 for all costs if at the start of an internally developed software project the total costs are expected to exceed $50,000. In addition to the $50,000 threshold, the project must have a specific objective and service capacity; demonstrate feasibility to complete the project, and demonstration of an intention to develop the software. If software is developed while research is being conducted and it did not have that objective or service capacity at the beginning of the research, the costs would not be capitalized.
Website - Account code 691065 should be used to account for all costs if at the start of a web project the total costs related to the development of a website internally (by university personnel) are expected to exceed $50,000. Also use 691065 for any costs related to the development of a website by a 3rd party and costs are expected to exceed $25,000 at the onset of the 3rd party agreement. Use account code 535225 for website related costs that are less than these capitalized thresholds.