Reference no: EM132623742

Question - What is the test for deferral of research costs as required by AASB 138?

Research costs can be deferred (recorded as an asset) when it is probable that the project they are applied to will bring future economic benefits. Research costs may not be deferred unless it is almost certain that the project they are applied to will bring future economic benefits. Research costs may not be recorded as an intangible asset. Research costs may be deferred if the entity can demonstrate that an intangible asset exists and that it will generate future economic benefits.