Date of this version

Fall 10-11-2012

Document Type



R&D Expenditures, Uncertainty


This paper contributes to the current debate on accounting treatment of R&D expenditures. We considered two different measures of future benefits to a firm, sales revenue and operating cash flows. We provide evidence that R&D expenditures do not generate more uncertain future sales revenue or operating cash flows compared to capital expenditures. In terms of sales revenue, R&D expenditures generate significantly less uncertain future benefits compared to capital expenditures. And in terms of operating cash flows, our results do not provide conclusive evidence that whether R&D expenditures generate more uncertain future benefits than capital expenditures or not.

Published in

Journal of Accounting and Finance

Citation/Other Information

Asdemir, O., Mufti M., and Sheikh F., "R&D Uncertainty in Future Benefits" Journal of Accounting and Finance, 12(3), October 2012.

Included in

Accounting Commons