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To: ahhaha who wrote (4676)	7/2/2002 2:25:14 PM
From: Keith Monahan	Read Replies (1) of 24758

Would a difference be needed between capitalized cost and expense? The purpose of recording something as capital is to ensure that costs are allocated to the correct period. For example, if you implement a supply chain system for $10 million and the system has a useful life of 10 years, it would be proper to recognize only $1 million in expense each year. I would think any changes in this methodology would be made independently of any tax considerations. Having said that, I think some type of free cash flow model that eliminated the distinction between expense and capital would be preferable to the current accounting treatment.

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