The IT Accounting Debate

An unnamed company has a defunct training room with 5 new computers sitting in it with only 3 of them ever being used. In fact, two of the computers have not been plugged into the power sockets in the 4 months since they were purchased.

There are no future plans to ever utilize those two computers. The company has dismantled its training department and has no plans to reinstate it.

A new need has developed for a PC on the manufacturing line that would give valuable feedback to the workers on that line. The manager for that department suggested that, instead of purchasing a new computer, we redeploy one of those wasted training room computers to the new line.

Person A in the IT department argued that this would violate some accounting practice that he was not sure of. He said that, if this department wants a computer, they need to account for it’s dollars at a department level as if it were a new computer and not skate on the fact that it has already been purchased by the company,

He believes that moving the computer from one department to another is an Accounting issue that needs to be realized as a cost to that department.

Person B takes the view that the company realizes resources as a whole and not as bickering departments. He believes that a move of an unused resource between departments has nothing to do with Accounting.

B argues that the new computer has been sitting on the floor of the training room for months unused is actually wasting the company’s money that can be only put to value by transferring it to an area of the company where it can be used to produce goods.

Person A and Person B seem to have different paradigms of how the accounting of computer equipment should be done. Person A partakes in the old school paradigm that pits departments against neighboring departments for control and usage of resources while Person B sees the company as a whole where every resource is accounted for on a company level.

Person A insists that there is some Accounting law that needs to be adhered to when moving a computer from one area of the company to another that requires that department realize the cost of the equipment as if it were a new purchase. When asked for an example, Person A simply shrugged and said that he didn’t want to argue about that and changed the subject.

Who is right? Person A or Person B? Who would you want in your IT Department?