For Batteries Plus Bulbs, over how many years is internal-use software amortized?

According to Batteries Plus Bulbs's 2025 Franchise Disclosure Document, the company amortizes its internal-use software straight-line over a period of seven years, starting when the asset is placed in service. This means that the cost of the software is spread out evenly over those seven years for accounting purposes.

For a prospective franchisee, this detail from the financial statements is unlikely to have a direct impact on their day-to-day operations. It is more relevant to understanding the overall financial management practices of Batteries Plus Bulbs. However, it does provide insight into how the company values and depreciates its software assets, which can be useful for assessing the company's investment in technology.

It's important to note that costs related to internal-use software are expensed as incurred until the preliminary project stage is completed and the application development stage is reached. After that point, certain development costs are capitalized, including external direct costs, direct payroll and payroll-related costs, and interest costs. This capitalization and amortization approach is a standard accounting practice for software development costs.