R&D expenditure capitalization expenditure is the expenditure incurred by an enterprise in the process of R&D, and there are three main ways to deal with R&D expenditure capitalization expenditure at the end of the period:
Expense treatment: Eligible capitalized expenses are directly included in profit or loss for the current period
Capitalization: Recognize eligible capitalized expenditures as long-term assets
Amortization treatment: Eligible capitalized expenses are allocated to profit or loss for each period.
Expense processing
Steps: 1) Determine whether the capitalized expenditure meets the conditions for expense
2) If the conditions are met, it will be directly included in the profit or loss for the current period.
Materials required: 1) R&D project plan and related materials;
2) Breakdown of capitalized expenditures;
3) Expense-based processing approval form.
Capitalization treatment
Steps: 1) Determine whether the capitalized expenditure meets the conditions for capitalization;
2) Recognize it as a long-term asset if eligible;
3) Depreciation or amortization over the life of the asset.
Materials required: 1) R&D project plan and related materials;
2) Breakdown of capitalized expenditures;
3) Approval form for capitalization treatment;
4) Long-term asset card or related vouchers.
Amortization treatment
Steps: 1) Determine whether the capitalized expenditure is suitable for amortization
2) If appropriate, determine the amortization period and amortization method;
3) Allocate capitalized expenses to profit or loss for each period.
Materials required: 1) R&D project plan and related materials;
2) Breakdown of capitalized expenditures;
3) Amortization processing approval form;
4) Amortization Calculation Table.
When processing R&D expenditure capitalized expenditure at the end of the period, it should be carried out in accordance with the accounting standards for business enterprises and relevant policies to ensure the compliance and accuracy of the processing;
When carrying out expense, capitalization and amortization treatment, the actual situation and needs of the enterprise should be fully considered, and the appropriate method should be selected
During the processing process, communication and coordination with relevant departments should be maintained to ensure the smooth progress of the processing.
In general, the appropriate method for the period-end treatment of R&D expenditure capitalization needs to be selected on a case-by-case basis. Whether it is expense, capitalization or amortization, it is necessary to comply with the accounting standards for business enterprises and relevant policies and regulations, and at the same time make decisions based on the actual situation and needs of the enterprise. In the process of processing, it is necessary to maintain prudence and patience, and do a good job of relevant records and approvals, so as to accurately reflect the financial status and operating results of the enterprise.