Explain and discuss the application of AASB 138 in its proposals to account for research and development expenditure.

Question

Quizplus · Accepted Answer

The Answer is Paragraph 126 of AASB 138 requires disclosure of the aggregate amount of research and development expenditure recognised as an expense during the period.In relation to intangible development assets,AASB 138 requires extensive disclosures but fails to mention research and development as one of the possible classes of intangibles for which disclosure is required (para.119).Assuming research and development assets are a separate class of intangible assets,the disclosures required are extensive,including requirements to: • disclose whether useful lives are indeﬁnite or ﬁnite and,if ﬁnite,the useful lives or amortisation rates used; • disclose the amortisation methods used for intangible assets with ﬁnite lives; and • reconcile the opening and closing asset balances showing additions,revaluations,impairment losses and amortisation.

Explain and Discuss the Application of AASB 138 in Its