Examines the records in the research and development (IPRD) for the acquisition under purchase method of accounting. Provides information on accounting and purchasing standards used to identify and treat IPRD. We also discuss the practice, which has led to disputes IPRD account in the mid-1990's. The situation is a small software company acquisition (Mirabilis) with a very popular product of Internet software for instant messaging, but no income. Acquisition by America Online, said the acquisition announcement that it intends to write off a significant amount of the purchase price as IPRD. Shortly after this announcement, the new chief accountant of SEC indicated that the SEC was concerned about the amount of such write-downs. Asks as CFO AOL should meet and what impact IPRD write-off amount will be on the future earnings of the company and the stock price. "Hide
by Mary E. Burt, David W. Hoyt Source: Stanford Graduate School of Business 23 pages. Publication Date: December 5, 2000. Prod. #: A166A-PDF-ENG
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