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This blog focuses on GASB 96 which applies to subscription-based informationtechnology arrangements (SBITAs) as of June 2022. You should recognize amortization of the discount on the subscription liability as an outflow of resources (for example, interest expense) in subsequent financial reporting periods.
One such term that has been gaining attention in recent years, particularly in the context of governmental accounting, is SBITA, which stands for Subscription-Based InformationTechnology Arrangement. The amortization expense should be recognized as an outflow of resources (expense) in the statement of activities.
Additionally, the Statement of Revenues, Expenditures and Changes in Fund Balances needs to reflect the depreciation expense on the right-of-use asset and the interest expense on the amortization of the corresponding liability, like it would for finance leases.
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