Study On Motivation Factors Of Research And Development Expenditure Conditional Capitalization

Under the knowledge economy environment, the competition in enterprises ismainly the competition of innovation. In order to maintain their corecompetitiveness and sustainable competitive advantage, enterprises, especiallyhigh-tech enterprises are actively engaged in Research and Development activities,which brought Research and Development expenditures surge. The accountingtreatment of huge R&D expenditures becomes the focus of attention in theaccounting profession. In2006, the new CAS-5adopts the conditionalcapitalization mode to enterprise’s Research and Development expenditure.The article initially reviews the domestic and foreign literature of the motivesof accounting policy choice and R&D expenses capitalization motivation.Especially the western three accounting assumptions: compensation contracthypothesis, debt contract and political cost hypothesis.Than the article summarizesthe hypothesis of capital market motivation hypothesis. Finally the article combineto link to integrate our country economic conditions, arrival at a conclusion that themotivation factors of research and development expenditure conditionalcapitalization of Chinese enterprises is management compensation contractmotivation、 debt contract motivation、 to avoid losing motivation allotment and soon.Secondly, the article reviewed the development of domestic and foreign R&Dexpenditure accounting and the motivation t of our country research anddevelopment expenses capitalization theory. Provide the theoretical foundation forempirical research. And analysis R&D cost capitalization implementationsituation and motivation in the listed company. The article Points out the necessityand rationality of the research and development expense capitalization choicemotivation hypothesis.Finally, the paper does an empirical study of the motivation factors of R&Dexpenditure Conditional Capitalization which based on the sample of listedcompanies from the year2007to the year2010. The result shows:(1) in loss listedcompanies, the main motivation of enterprises choose R&D cost of capital is debtcontract motivation;(2) in the profit listed companies, research and development expense capitalization motivation is avoiding a loss motivation;(3) in good profitslisted companies, the main motives of research and development expensecapitalization is profit smoothing motive and rights motivation;(4) in the highprofitability listed companies, earnings smoothing motive, motive and debt contractrights motivation is high profitability listed companies choose R&D cost of capitaldominant motive. According to the empirical results, this paper puts forward togive some suggestions.