There is scope for capitalisation of certain expenditures in the Australian accounting standards and the arguments around this can be complex and detailedThe challenge here is that if you've capitalised too many costs, you are going to have problems and that is what is coming to the fore now at Freedom Foods..

Professor Wells

Required:

Discuss the above quotation from Professor Wells. You should define, and distinguish between research and development in your discussion including accounting requirements for initial recognition and how this may impact on business choices around environmental and economic responsibility.