Development
Development applies research findings or other knowledge to a plan or design for new or substantially improved products or processes before commercial use. Expenditure is capitalised only after all IAS 38 criteria are demonstrated: technical feasibility, intention and ability to complete and use or sell, probable benefits, adequate resources and reliable measurement of attributable expenditure. Otherwise it is expensed.
Worked example
A feasible new product has a demonstrable market, funded completion plan and separately measurable costs: qualifying costs incurred after those conditions are met become an asset.
Common mistake
A successful outcome does not allow earlier research or development expenditure already expensed to be reinstated retrospectively.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | FA | Direct | September 2026–June 2027 |
| ACCA | FR | Direct | Official assessment-window verification pending |
| ACCA | K1 | Direct | July 2027–August 2028 |
| CIMA | BA3 | Direct | Official assessment-window verification pending |
| CIMA | F2 | Direct | Official assessment-window verification pending |
| FIA | FFA | Direct | September 2026–June 2027 |