Research On The R&D Expenditure Accounting-Case Of H Pharmaceutical Company

In recent years,China has vigorously promoted the development strategy of innovation driven development.At present,China's innovation driven strategy includes two modes,namely,the promotion of government policies and the innovation of enterprises.The investment in research and development has increased year by year,and the intensity of R&D expenditure(the ratio of R&D funds and main business income)is also continuously increasing.The driving force of innovation in the medical industry is particularly strong.The R&D investment and R&D intensity of the pharmaceutical manufacturing enterprises are in the forefront of various industries,and it has a significant position in the development strategy of innovation driven in China.But the accounting of R&D expenditure in the pharmaceutical manufacturing industry is also different,mainly divided into two categories,one category of pharmaceutical enterprises will expense all R&D expenditure.Another kind of pharmaceutical enterprises will capitalize partial cost of R&D expenditure.Adjustable accounting treatments makes the financial report of the whole pharmaceutical manufacturing industry less of comparableness.Pharmaceutical manufacturing industry has several features like: high investment,clear milestone,high uncertainty and low return rate could give more guidelines for us to find which treatment method is more reasonable.Taking H pharmaceutical company as a case,this paper analyzes the research and development situation of H pharmaceutical company,and analyzes the accounting policies and accounting treatment methods for R&D expenditure of H pharmaceutical company.And compared with a similar company,Hengrui Co,Ltd.This paper summed up the problems exposed in the process of accounting treatme nt of Hengrui Co,Ltd,like the research and development phase definition is not reasonable,Unreasonable accounting for R&D expenditures leads to profit level is overvalued,the problem of insufficient disclosure.Furthermore,this paper gives advice to solve these problems.Finally,through the analysis of the accounting treatment of H pharmaceutical company's R&D expenditure,this paper compares the accounting treatment policy of the industry leading enterprise Heng Rui medicine,and gives more explicit accounting treatment guidelines for pharmaceutical companies.