Accounting for research and development expenditure: an analysis of the Rolls Royce RB.211 project

P. W. Wolnizer*, W. T. Austin

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)

Abstract

There is evidence that standard setting bodies see the promotion of uniformity of accounting practice as a major objective in setting accounting standards. However, recently issued standards in respect of the accounting treatment of research and development costs allow corporate managers considerable choice in accounting for these costs. An examination of the circumstances surrounding the development of the RB.211 engine by Rolls Royce Limited during the years 1967‐70 is undertaken to determine the extent to which different practices may be employed in accounting for research and development costs under the U.K. and International accounting standards. Evidence adduced from this examination suggests that the management of Rolls Royce Limited could have complied with the requirements of these accounting standards and still have been free to expense or capitalise the costs incurred on the RB.211 project.

Original languageEnglish
Pages (from-to)19-32
Number of pages14
JournalAccounting & Finance
Volume22
Issue number2
DOIs
Publication statusPublished - 1982
Externally publishedYes

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