Agile Project Cost Accounting

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Hong Sun, Management Consultant, Canada
🔥NEW It's very important for a company to take an informed decision as to how to account for its projects' costs. When it comes to agile projects, the accounting decision can be even more complicated to make, since most generally accepted accounting practice (GAAP) guidelines that explain capitalization rules were mainly designed for traditional IT projects. Whereas it's not an easy task, there is still a way to properly allocate agile projects' costs without sabotaging the company's objectives or breaching tax laws. The structure of allocating agile project cost is as follows: Cost allocation BEFORE the first iteration starts
  • Any work the development team does before it obtains initial funding approval such as portfolio planning and envisioning (product planning), by default, should be expensed.
  • Release planning: can be either expensed or capitalized.
Cost allocation DURING the iterations

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Accounting for Agile Projects

Agile projects (wether in software development or (...)

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