The recommended treatment under AASB 138 and Interpretation 132 of i.planning costs and ii.graphics and content costs,incurred internally by a company to develop its website is:
A) write-off both as expenses
B) i. expense: ii. recognise as an intangible asset if all the requirements of AASB 138 are met
C) recognise both as intangible assets if all the requirements of AASB 138 are met for both
D) it depends on the reasons the website was developed, e.g., was it primarily to promote and advertise the company's products?

Question

Quizplus · Accepted Answer

According to AASB 138, website development costs can be recognized as intangible assets only if certain criteria are met, which includes the ability to identify the asset, it's probable future economic benefits, and the ability to measure the cost reliably. As graphics and content costs do not meet the recognition criteria, they should be written off as expenses. Therefore, i. planning costs should be expensed and ii. graphics and content costs should be recognized as an intangible asset if all the requirements of AASB 138 are met.

The Recommended Treatment Under AASB 138 and Interpretation 132 of I.planning