Question · Acquisition as part of a business combination

The laboratory Cerevia acquires the biotech Ostrea in a business combination. Ostrea is running a molecule project protected by patents, which it has always expensed; an expert measures its fair value at 3,000,000 at the acquisition date. After the acquisition, Cerevia continues the project: part of the work consists of exploring new scientific avenues, another part of finalising a process whose feasibility has been demonstrated. The management accountant proposes to subsume the project in goodwill and to capitalise all future expenditure, since the project is now an asset. Write a position paper.