G6 Research and development costs

 

2020

2021

Expenditure for

 

 

Research and development

–3,604

–3,871

Quality assurance

–445

–406

Total

–4,049

–4,277

 

 

 

of which expensed, total

–3,874

–4,089

of which expensed relating to research and development

–3,429

–3,682

Accounting principles

Research and development

Expenditure on research activities related to the obtaining of new scientific or technical knowledge is expensed as incurred. Expenditure on development activities, whereby the research results or other knowledge is applied to accomplish new or improved products or processes, is recognized as an intangible asset in the balance sheet, provided the product or process is technically and commercially feasible and the company has sufficient resources to complete development, and is subsequently able to use or sell the intangible asset.

The carrying amount includes the directly attributable expenditure, such as the cost of materials and services, costs of employee benefits, fees to register intellectual property rights and amortization of patents and licenses. Other expenses for development are expensed as incurred. In the balance sheet, capitalized development expenditure is stated at cost less accumulated amortization and any impairment losses.

For further accounting principles on research and development see section in intangible assets note G13.