Case Study

Software Capitalization Strategic Assessment

Strategy Technology


Large U.S. Retail Brokerage


Technology Operational Optimization, Technology Strategy, Operations & Process Improvement

Project Overview

To ensure software capitalization was not overstated on the balance sheet, the Client sought to confirm that current processes and controls accounted for the capitalization of internally developed software (IDS). Reference Point performed an independent, end-to-end strategic assessment, engaging in numerous stakeholder interviews and collaborative working sessions with key departments across the financial institution, including Technology, Project Management, Financial Planning & Analysis (FP&A), and Accounting - all actively involved in the firm's end-to-end IDS capitalization process. Assessment results not only provided the Client with the requested visibility into the end-to-end process, but also included strategic recommendations aimed at enhancing asset tracking capabilities and driving process enhancements and automation.


  • Reference Point assembled a dedicated team to spearhead the strategic initiative, consisting of seasoned professionals well-versed in accounting principles and financial reporting with a primary objective of ensuring accurate capitalization of software on the balance sheet, thereby ensuring transparency, compliance, and precise financial reporting.
  • The strategic advisory team provided guidance to the Client's leadership on industry-leading practices, conducted an in-depth assessment of the current state, and formulated a comprehensive target IDS capitalization process for the end-to-end application delivery and management process. This encompassed multiple organizations, more than 25 processes, and the implementation of over 15 controls to ensure adherence to best practices and regulatory requirements.
  • Through conducting stakeholder interviews Reference Point gained a deeper understanding of current processes, controls, systems, and applications. This facilitated the identification of crucial areas for enhancement and automation. Additionally, a comprehensive roadmap and project plan were developed to serve as a guiding framework for implementing the proposed recommendations in a structured and effective manner.


  • The assessment conducted by Reference Point yielded 100+ findings, resulting in the development of 10 comprehensive work packages supported by 46 detailed recommendations. These deliverables enabled the Client to prioritize long-term investments effectively. Additionally, the team identified a set of "quick wins" and actionable changes that could be promptly implemented within existing processes and controls.
  • The comprehensive work packages were consolidated into a meticulously crafted implementation roadmap, which encompassed resource estimates. This roadmap served as a valuable tool for decision makers, equipping them with essential information to address process and control issues, seamlessly integrate asset tracking into the IDS capitalization process, automate labor-intensive tasks, and progress towards the envisioned future state IDS process flow.
  • Through this assessment, Reference Point ensured precise reporting of software capitalization in the financial statements, resulting in enhanced accuracy of the Client's financial reports. This enabled the Client to maintain compliance with accounting standards, while fostering stakeholder trust.

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