Globo Manufacturing recently acquired a factory building for $$20$ million on March $1,2024.$ Along with the purchase price, the company incurred additional costs of $$1\mathrm{.}5$ million for site preparation, $$800,000$ for machinery installation, and $$400,000$ in legal fees associated with the acquisition. The factory has a useful life of $30$ years and is expected to produce significant economic benefits throughout this period. To ensure the building meets safety standards, the company spent an additional $$500,000$ on safety equipment and inspection before commencing production.

In addition, Globo Manufacturing installed a high$-$efficiency conveyor system costing $$5$ million, with a useful life of $10$ years. The system requires annual maintenance costs of $$200,000,$ expected to extend its functional efficiency. The technical team recommends replacing the system every $10$ years to maintain production efficiency, which would require a future upgrade cost of approximately $$2$ million.

To streamline operations, Globo Manufacturing developed a custom software program to monitor production processes. The software development spanned over two years, costing a total of $$1\mathrm{.}8$ million. During the first year, the research phase cost $$800,000,$ while the development phase in the second year amounted to $$1$ million. The software is expected to have a useful life of five years, after which it will require periodic updates costing $$150,000$ annually.

The company also spent $$250,000$ training employees to operate the new machinery and $$350,000$ on advertising to promote the launch of the new production line. Globo Manufacturing$$s finance manager is concerned about the correct treatment of these costs in accordance with IAS $16$ and IAS $38.$

Required:

a$)$ Calculate the total cost for the initial recognition of the factory building as part of Property, Plant, and Equipment $($PPE$)$ under IAS $16.$ Include site preparation, installation costs, and legal fees. Should the safety equipment and inspection costs be capitalized or expensed, and why? $(4$ marks$)$

b$)$ Discuss the treatment of the conveyor system. Should the annual maintenance cost and the future upgrade cost be capitalized or expensed under IAS $16?(3$ marks$)$

c$)$ Under IAS $38,$ explain the criteria that must be met for the software development costs to be recognized as an intangible asset. Differentiate between the research and development phases in this scenario, and state which costs can be capitalized. $(3$ marks$)$

d$)$ How should the employee training costs and advertising expenses be treated under IAS $16$ and IAS $38,$ respectively? Provide justification for their treatment. $(3$ marks$)$

e$)$ Given the periodic software updates planned for the future, should these costs be capitalized or expensed according to IAS $38?$ What factors influence this decision? $(2$ marks$)$