Standard Defines Development and Research

The standard defines development and research as follows:

(a) Research - planned and original investigation undertaken along with the prospect of gaining new technical or scientific understanding and knowledge.

(b) Development - the application of research findings or other knowledge a design or plan for the generation of new or substantially improved products, materials, devices etc. prior to the commencement of commercial use or production.

1. Research costs must be expensed in the duration whether they are incurred
2. Enterprises costs must be expenses in the duration in which they are incurred

Enterprise must write off every development costs, they can demonstrate unless (a) to (f) below, whether case the cost must be recognized as an asset.

(a) The methodological feasibility of completing the intangible asset and need or sell it

(b)   The intention to complete the intangible asset and need or sell it

(c)   The ability to need or sell the intangible asset

(d)   How the intangible asset will produce probable future economic benefits.  Among other this, the enterprise should demonstrate the existence of a market for the production of the intangible asset pr the intangible asset itself or whether it is to be required internally the usefulness of the intangible asset.

(e) The availability of adequate financial, technical and other resources to entire the development and to require or sell the intangible asset,

(f) The ability to calculate the expenditure attributable to the intangible asset while its development reliably.