There Is a Concern That Research and Development May Be

There is a concern that research and development may be reduced as a result of the new requirements in IAS 38 because:

A) Companies will not have the cash available to pay for the research expenses up-front.
B) Recognising expenses early will allow for larger profits later, which will help smaller firms.
C) The 'horizon problem' suggests managers will not invest in long-term projects that do not immediately increase profits.
D) Shareholders are only interested in short-term profits and will not be impressed by strategies that attempt to increase the long-term value of their shares.

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