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Accounting - Technology Enterprises Ltd Case Study

   

Added on  2020-12-24

10 Pages2785 Words367 Views
Case study report
Accounting - Technology Enterprises Ltd Case Study_1
EXECUTIVE SUMMARYRecording, interpreting, reporting and disclosing of the financial information is theprocess of financial accounting.IAS 38 provides for the recognition, measurement and disclosureof the tangible assets which are not governed or which are not dealt with any other standard.R&D project of Technology Enterprise is recognisable as it meets the above mentioned criteria.The project will provide the economic benefit for 10 years. If the intangible asset has beengenerated internally after meeting all the recognition conditions, is measured at the cost which isascertained by adding all the expenditure incurred from the date when intangible asset first metthe recognition criteria.*If either of the conditions would not have been fulfilled by theintangible asset, all the costs of the R&D asset will be treated as expenditure as if they wereincurred for the motive of research only. IFRS adoption by many countries has resulted in theamendment in the ways regarding how companies account for and report financial information intheir financial statements. If any intangible does not meet these criteria, then such assets will notbe considered as the intangible asset and the cost of acquiring or developing such asset will betreated as expenses and will not be capitalisedAASB 13B/IAS 38 are the accounting standardsprovides guidelines about the recognition and measurement and disclosure of various intangibleassets held by a business organisation. Further, with the help of adopting AASB 13B/IAS 38,Technology Enterprise can determine the most appropriate amount of generation of intangibleassets to be capitalised or to be shown as expenses in such a way so that it shall not result inmisguiding the investors for the purpose of deciding the certain amount to be invested in thecompany. In this regard, company's reputation in the market may go downwards.
Accounting - Technology Enterprises Ltd Case Study_2
Table of ContentsEXECUTIVE SUMMARY.............................................................................................................2INTRODUCTION...........................................................................................................................1MAIN BODY..................................................................................................................................11. How the R&D project should be accounted for in the financial statements............................12. To what extent might the rules or restrictions in AASB 138/ IAS 38 reduce thecomparability of financial statements..........................................................................................33. Providing response to CEO over the understanding about AASB 13B/IAS 38 and theefficient market hypothesis along with recommendations for company to mitigate theirconcern about investor's interpretation........................................................................................4CONCLUSION................................................................................................................................6REFERENCES................................................................................................................................7
Accounting - Technology Enterprises Ltd Case Study_3

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