CERTYNEX IFRS ACADEMY

Pyrene runs two internal projects. For project Alpha, a formal review documents the move from the research phase to the development phase. For project Beta, the work is so intertwined that no separation is possible. Which analysis is correct?

Alpha and Beta: all the expenditure is capitalised as soon as management considers the project promising.

Alpha: all the expenditure expensed; Beta: expenditure split equally between expense and asset.

Alpha: research expensed, development capitalised if the criteria are demonstrated; Beta: all expensed.

Alpha: all the expenditure capitalised from the start of the project; Beta: expenditure capitalised once technical feasibility is demonstrated.