Subscription-Based IT Arrangements (SBITA)
A subscription-based IT arrangement is a contract that conveys control of the right to use another party's IT software, alone or in combination with tangible capital assets. GASB 96 requires government entities to recognize SBITA assets and liabilities on the balance sheet.
Why it matters
SBITAs include SaaS subscriptions, cloud computing services, and licensed software. Before GASB 96, these were expensed as incurred. Now government entities must evaluate each arrangement, determine whether it qualifies as a SBITA, and recognize the corresponding asset and liability. similar to GASB 87's treatment of leases.
How Arvexi handles this
Arvexi supports GASB 96 natively, recognizing SBITA assets and liabilities with the same automated workflows used for GASB 87 leases. Government entities manage both leases and IT subscriptions in a single platform.