Accounting Regulation and Treatment of Patents
XYZ Research Company Case Study
You have been hired as a consultant for XYZ Research Co. XYZ Research Co. incorporated in 2010. XYZ ‘s business centers on developing new technology for interplanetary exploration. The company has many patents and has historically expensed all of the costs associated with obtaining their patents. The owners of XYZ Labs are unsure whether or not if any or all of its patent costs can be capitalized. They also are unsure if any impairment testing should be done periodically on their patents. You have been asked by the owners to look into these issues and provide the appropriate accounting treatment for patents.
Accounting Regulation and Treatment of
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Some of the most important steps involved in attaining this task are: * Maintaining Entries are in Compliance to the Accounting Standards: One must remember that there are various accounting entries that are required to be made in order to ensure that the books are compliant with accounting standards. For example, there are some benefit expense accounting that are in the form of an actual liability, but also a gain loss recording. On the other hand, there are certain assets that are demanded to be valued at their fair value on the recording date; which would require entries to be recorded within the books that value the difference of those assets. Nonetheless, compliance comes with frustration as it can guide you in being unable to locate a proper solution to a particular accounting problem. * Requirements of Financial Reporting: The finance department’s main and most important role is to ensure that their team report the accurate results of the corporation at the end of the fiscal year. It is rule that accounts within the books need to be closed at the end of the year and records must be summarized accordingly in order to produce accurate reports and statements that abide by regulatory authority, along with disseminating the information in a matter easily understood by the viewers and users of the financial statements. This is a vital and crucial process since all the accounting work that