Assume that you work for a software company providing ‘hosted solutions’, that is, services for business applications such as payroll or accounts which are made available over the internet and include both the necessary software and the computing facilities to run it. Explain using examples how the following assets would be valued for balance sheet purposes:
i) Buildings, such as a data centre;
ii) Computer equipment, such as the servers in the data centre;
iii) Debtors, such as clients who pay on a quarterly basis in arrears for use of the software.