Comptroller's Office
 Policies and Procedures Manual


CMP 140: Guide to Intangible Asset Effort Reporting

The following is a guide for level of effort reporting during an intangible asset project. For purposes of CMP 140: Intangible Assets level of effort reporting represents the employee's effort (typically hours) spent on certain project activities, the costs of which (salary & ere) will be eligible for intangible asset capitalization. Level of effort reporting is required for internally generated intangible assets (i.e., where cost of incremental effort is more than thirty percent 30% of the cost of the underlying purchased resource or there is a remote chance that incremental costs will exceed the 30% threshold.  See Q&A #2)

Level of effort should only be reported during the project or application development stage of the project.  The Project Manager should define the begin and end dates for this stage of the project. See CMP 140.12 - Internally Generated Computer Software for a further description of the application development stage.

General Guidelines:
During the application development stage of the project, the level of effort (hours) should be reported for any activity that is necessary to place the asset into its intended service use (i.e., costs directly related to the creation of the intangible asset.  See Q&A #10).  Common examples include the following:

      Activities Generally Excluded from level of effort reporting:

For other activities, ask the question... does the activity contribute to readying the asset for its intended use.  If the answer is yes, then it likely should be reported. If you are still unsure, check with your project manager and or Financial Accounting Services (FAS).

General Responsibilities: