Token CapEx
Token CapEx is the practice of treating LLM token, compute and inference spend as capital expenditure that can sit on the balance sheet, capitalized and amortized over the commitment or useful life, rather than defaulting to operating expense. It applies to development-window build cost under ASC 350-40-25 and IAS 38 development; production inference is expensed or booked to cost of revenue.
The posting consequence
Framing spend as Token CapEx changes the line it hits: a capitalizable build debits a software asset instead of expense, a commitment sets up a prepaid, and production consumption stays in the P&L. The term is a lens for asking which ledger line the spend belongs on, not a claim that all token spend capitalizes.
Posts to
Primary sources
- [S1] KPMG: Hot Topic: Accounting for internal-use software (ASC 350-40) (US GAAP)
- [S5] IFRS Foundation: IAS 38 Intangible Assets (IFRS)
Ledger current as of 2026-07-24. A position and a citation, not accounting advice. See how we cite.