Capitalization of website development charges

My company is redeveloping its website. The work is assigned to some professional agency which has enough prior experience of developing such website.

I want to know that can this be capitalzed. If not, than what r the conditions which needs to be satisfied to capitalize this.

Replies (3)

 

 Dear Manish,

 With regards to your querry, Accounting Standard 10 (Accounting For Fixed Assets) - expenditure that increases the future benefits from the existing asset beyond its previously assessed standard of performance is included in the gross book value, e.g., an increase in capacity.

So, if redevelopment of website increase the future benefit and its of material amount it should be capitalised.

     i think so as 26 will applicable.. when you are redveloping the site it means any subsequent expenditure on these asset capitalised only when probable that the expenditure will enable the asset togenerate future economic benefits in excess of its originallyassessed standard of performance; and the expenditure can be measured attributed to the asset reliably. if both  the above condition will fulfil then only we can capitalised it..

I agree with jay shah Website devolpment charges covered under AS-26

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