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Software Development Costs (Notes)

9 Months Ended

Sep. 30, 2021

Research and Development [Abstract]

Research, Development, and Computer Software Disclosure [Text Block]

SOFTWARE DEVELOPMENT COSTS

Software development costs consists of the following:

			September 30, 2021						December 31, 2020
Software development costs			$	3,036,810					$	3,036,810
Less accumulated amortization			(1,909,717)						(1,564,126)
Software development costs, net			$	1,127,093					$	1,472,684

The Company developed its web-based influencer marketing platform, IZEAx, to enable influencer marketing and content creation campaigns on a greater scale. The Company continues to add new features and additional functionality to IZEAx and developed additional platforms in 2020, BrandGraph and Shake, to facilitate the contracting, workflow, and delivery or posting of content as well as provide for invoicing, collaborating, and direct payments for the Company’s customers and creators. The Company capitalized software development costs of $0 and $266,035 during the nine months ended September 30, 2021 and 2020, respectively. The Company has capitalized a total of $3,036,810 in direct materials, consulting, payroll, and benefit costs to its internal use software development costs in the consolidated balance sheet as of September 30, 2021.

The Company amortizes its software development costs, commencing upon initial release of the software or additional features, on a straight-line basis over the estimated useful life of five years, which is consistent with the amount of time its legacy platforms were in service. Amortization expense on software development costs that is excluded from cost of revenue and recorded in depreciation and amortization expense in the accompanying consolidated statements of operations and comprehensive loss was $115,159 and $102,538 for the three months ended September 30, 2021 and 2020, respectively, and $345,591 and $305,727 for the nine months ended September 30, 2021 and 2020, respectively.

As of September 30, 2021, future estimated amortization expense related to software development costs is set forth in the following schedule:

			Software Development Amortization Expense
Remainder of 2021			$	107,493
2022			400,474
2023			359,685
2024			177,764
2025			78,920
Thereafter			2,757
Total			$	1,127,093

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- References

No definition available.

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- Definition

The entire disclosure for research, development, and computer software activities, including contracts and arrangements to be performed for others and with federal government. Includes costs incurred (1) in a planned search or critical investigation aimed at discovery of new knowledge with the hope that such knowledge will be useful in developing a new product or service, a new process or technique, or in bringing about a significant improvement to an existing product or process; or (2) to translate research findings or other knowledge into a plan or design for a new product or process or for a significant improvement to an existing product or process whether intended for sale or the entity's use, during the reporting period charged to research and development projects, including the costs of developing computer software up to the point in time of achieving technological feasibility and in-process research and development acquired in a business combination consummated during the period.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 985
-SubTopic 730
-URI http://asc.fasb.org/subtopic&trid=2197926

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