{"title":"开发成本资本化还是费用化?-关于英国私营公司会计政策决定因素和动机的混合方法证据","authors":"Annika Brasch, B. Eierle, Robin Jarvis","doi":"10.1080/17449480.2022.2049327","DOIUrl":null,"url":null,"abstract":"ABSTRACT Following calls for further research, this study evaluates the determinants and motives behind private companies’ decision to capitalise development costs by using mixed methods. While prior literature and expert interviews indicate initially that private firms may be motivated opportunistically, subsequent archival analyses show that development costs are capitalised to meet benchmarks and ameliorate poor profitability. Additionally, interview evidence emphasises that debt covenant violation avoidance and increasing merger and acquisition (M&A) values are important drivers for capitalisation, whereas management compensation schemes do not seem to influence their accounting policy. Moreover, findings imply a negative association between firm size and the capitalisation of development costs. Expert interview evidence indicates that smaller companies are more likely to have financing needs, suggesting that capitalisation is employed to signal future economic benefits to investors. Conversely, the motivation for larger companies which are more likely to expense may be grounded on risk avoidance from future impairments.","PeriodicalId":45647,"journal":{"name":"Accounting in Europe","volume":"33 1","pages":"363 - 396"},"PeriodicalIF":4.6000,"publicationDate":"2022-06-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"1","resultStr":"{\"title\":\"Capitalising or Expensing Development Costs? – Mixed Methods Evidence on the Determinants and Motives of the Accounting Policy in the context of UK Private Companies\",\"authors\":\"Annika Brasch, B. Eierle, Robin Jarvis\",\"doi\":\"10.1080/17449480.2022.2049327\",\"DOIUrl\":null,\"url\":null,\"abstract\":\"ABSTRACT Following calls for further research, this study evaluates the determinants and motives behind private companies’ decision to capitalise development costs by using mixed methods. While prior literature and expert interviews indicate initially that private firms may be motivated opportunistically, subsequent archival analyses show that development costs are capitalised to meet benchmarks and ameliorate poor profitability. Additionally, interview evidence emphasises that debt covenant violation avoidance and increasing merger and acquisition (M&A) values are important drivers for capitalisation, whereas management compensation schemes do not seem to influence their accounting policy. Moreover, findings imply a negative association between firm size and the capitalisation of development costs. Expert interview evidence indicates that smaller companies are more likely to have financing needs, suggesting that capitalisation is employed to signal future economic benefits to investors. Conversely, the motivation for larger companies which are more likely to expense may be grounded on risk avoidance from future impairments.\",\"PeriodicalId\":45647,\"journal\":{\"name\":\"Accounting in Europe\",\"volume\":\"33 1\",\"pages\":\"363 - 396\"},\"PeriodicalIF\":4.6000,\"publicationDate\":\"2022-06-20\",\"publicationTypes\":\"Journal Article\",\"fieldsOfStudy\":null,\"isOpenAccess\":false,\"openAccessPdf\":\"\",\"citationCount\":\"1\",\"resultStr\":null,\"platform\":\"Semanticscholar\",\"paperid\":null,\"PeriodicalName\":\"Accounting in Europe\",\"FirstCategoryId\":\"1085\",\"ListUrlMain\":\"https://doi.org/10.1080/17449480.2022.2049327\",\"RegionNum\":0,\"RegionCategory\":null,\"ArticlePicture\":[],\"TitleCN\":null,\"AbstractTextCN\":null,\"PMCID\":null,\"EPubDate\":\"\",\"PubModel\":\"\",\"JCR\":\"Q1\",\"JCRName\":\"BUSINESS, FINANCE\",\"Score\":null,\"Total\":0}","platform":"Semanticscholar","paperid":null,"PeriodicalName":"Accounting in Europe","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1080/17449480.2022.2049327","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}
Capitalising or Expensing Development Costs? – Mixed Methods Evidence on the Determinants and Motives of the Accounting Policy in the context of UK Private Companies
ABSTRACT Following calls for further research, this study evaluates the determinants and motives behind private companies’ decision to capitalise development costs by using mixed methods. While prior literature and expert interviews indicate initially that private firms may be motivated opportunistically, subsequent archival analyses show that development costs are capitalised to meet benchmarks and ameliorate poor profitability. Additionally, interview evidence emphasises that debt covenant violation avoidance and increasing merger and acquisition (M&A) values are important drivers for capitalisation, whereas management compensation schemes do not seem to influence their accounting policy. Moreover, findings imply a negative association between firm size and the capitalisation of development costs. Expert interview evidence indicates that smaller companies are more likely to have financing needs, suggesting that capitalisation is employed to signal future economic benefits to investors. Conversely, the motivation for larger companies which are more likely to expense may be grounded on risk avoidance from future impairments.