GASB 96 - Subscription-Based IT Arrangement (SBITA) Right-to-Use Asset
Recording the right-to-use intangible asset and subscription liability for a government's subscription to cloud-based software or SaaS (Software as a Service) under GASB 96.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Right-to-Use Intangible Asset - SBITA (Cloud Software) | Asset (+) | 285,000.00 | - |
| SBITA Liability (Gov-Wide) | Liability (+) | - | 285,000.00 |
💡 Accountant's Note
GASB 96 (effective FY2023) applies lease-like accounting to subscription-based IT arrangements — cloud computing, SaaS, PaaS, IaaS — where the government controls the right to use IT assets. Like GASB 87 leases, governments recognize a right-to-use intangible asset and corresponding subscription liability measured at the present value of future subscription payments. Common examples: ERP cloud subscriptions (Tyler Munis SaaS, Oracle Cloud), cloud data storage, software-as-a-service applications. Arrangements with terms ≤12 months are exempt.
Practitioner & Systems Framework
💻 ERP Architecture
Inventory all cloud and SaaS subscriptions across all departments — many go undetected because technology subscriptions are often paid by credit card across departments without central IT oversight. Determine which subscriptions qualify under GASB 96 (government controls use, not just a right to receive service from the vendor's pool). The measurement is PV of future subscription payments at the IBR.
⚠️ Audit Flags
GASB 96 is very recently effective and many governments are still implementing. Auditors request a SBITA inventory and evaluate whether all significant subscriptions have been identified and measured. IT contracts that include both subscription and service elements require bifurcation — only the subscription element is on-balance-sheet.
📄 Required Documentation
SBITA inventory (all cloud/SaaS contracts evaluated), GASB 96 vs. service contract determination memo, SBITA calculation worksheets (PV of subscription payments), IBR determination, GASB 96 note disclosures, short-term SBITA exemptions.
Professional Excel Template
Get the automated version of this entry. Includes built-in IFRS checks, VAT calculators, and SAP-ready upload formats.
Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.