One of the primary in strive of assets valuation for research and
development is to provide data on how to recognize long lived assets and
distinguish between the two different types, tangible between the two
different types, tangible and intangible and to control to use for
internal control over research and development cost, those are of
interest to various groups e.g. government sector, private sector e.t.c.
Chapter one and two contains the introductory and
literature review relevant to the research while chapter three is the
conclusion and also the definition of terms used by the researcher in
the research work.
The essence of this topic is to trace the need of assets for research in the achievenment of development
In most organization and institution there is research and
development units. This is due to the emphasis laid on technology growth
by federal government. The research carried out by these unit’s vary
from one institution to another this may fall under industrial research
agricultural research scientific research food research, market research
These type of research may come under what standard
statement of accounting practice grouped as the main basic types of
research. Due to these research which are being carried out by different
organization a lot of benefit has accrued to have a conventional method
for reporting research and development expenditures.
The first standard on accounting treatment of research and
development expenditure it known as statement of financial standard
twelve (DFS)12 was issued in USA in 197A.
In January 1985 the accounting standard committee also
published exposure draft 12 (ED)12 accounting for research and
development expenditure in (GD)1A expenditure on pure and applied
research was considerated to be part of continuing operation which
required to maintain a company business and its competitive position.
These two standard DSF 12 and ED1A required expenditure whether pure or
applied should be accounting with comparative minor exception. The
standard did recognize that a case could be made for capitalizing
development expenditure, but it concluded that uncertainties were too
great. The exposure draft ended in April 1885 but a last later in 1986 a
revised expenditure draft came into being that development expenditure
could be matched clearly to future benefit which were reasonably
In December 1987 stadard statement of accounting practice
appeared essentially the same as ED1A but with some important different
of which one instead of requiring companines to compulsory before the
expensing of certain development expenditure it allowed them on option
1.1 STATEMENT OF PROBLEM
In recent years government has participated actively in caring out
research projects. This is in order to realized its objective of making
the country self sufficient and to increase the technological growth of
Considering these research range from scientific and
material research e.t.c. the most current ones are the production of
palm kernel, cracking madding garri pealing frying machines, and
extraction of Soya beans milk.
Another problem to time topic is to identify the prudent
procedures for fund allocation to research and development institution
in carrying out such research.
Furthermore the problem of that research work show’s the
assets that constitute plant property, equipment of the institute that
carrying such property and equipment of the institute carrying out the
Research institution are sometimes over loaded with a lot
of financial burden and such are confused on which of the hand
Accounting treatment of research and development cost is
also too controversies thereby having the problem of giving the general
accepted standard in order to alleviating such problem.
1.2 OBJECTIVES OF THE STUDY
The study is intended in order to find the following
vHow it recognizes long tired assets and distinguishes between the
two types of asset which know as tangible and intangible assets.