Research On The Capitalization Of R&D Expenditure Of Semiconductor Enterprise Listed On STAR Market

The science and technology innovation board(STAR)was announced by the President Xi Jinping at the opening ceremony of the first China International Import Expo on November 5,2018.STAR is positioned as high-tech enterprises that comply with national strategies,break through core technologies and have high market recognition.A common feature of these industries is the need for a sustained high proportion of R&D investment,which will necessarily involve the capitalization of R&D expenditures.As of November 14,2019,51 companies have entered the STAR Market.Advanced Micro-Fabrication Equipment Company(AMEC)is the only semiconductor company that has capitalized R&D expenditure and the capitalization ratio reaches 47.64%.During its listing review stage,the Shanghai Stock Exchange had made four inquiries with AMEC,and each time involved the capitalization of R&D expenditures.It can be seen that the CSRC has paid special attention to the capitalization of AMEC's R&D investment.Chinese new accounting standards allow companies capitalize R&D expenditures conditionally.Although the conditions for capitalizing R&D expenditures are clarified,they are not specified for different industries and different R&D activities.There is a certain amount of manipulation space for different companies in the process of capitalization.Therefore,it is necessary to study the capitalization of R&D expenditures in combination with the characteristics and processes of R&D activities in the special industry.The paper uses case analysis and selects AMEC as the research case.First,the paper sorts out the characteristics and processes of the R&D activities of the semiconductor equipment industry,and combines the current status of R&D expenditure capitalization and disclosure of comparable A-share listed companies to analyze the current problems with capitalization of R&D expenditure.in semiconductor industry.Then,this article analyzes the specific operation of AMEC through case analysis.Based on the inquiry process of listing,the rationality of the capitalization of R&D expenditure is analyzed from the perspective of the capitalization point,the financial control system of R&D activities,and the disclosure of R&D expenditure.Proposals for the capitalization of R&D expenditure in the semiconductor industry are given.Enterprises should correctly understand the value of capitalization of R&D expenditure,strengthen the construction of financial control systems for R&D activities.Supervisors should unify the industry specifications for capitalization of R&D expenditure,and improve the information disclosure system for R&D activities.The main innovation of this article may be reflected in:(1)The article sorts out the six major stages of R&D activities in semiconductor industry by consulting companies' prospectuses and other information;(2)The article summarizes the current status and problems of capitalization of R&D expenditures in the semiconductor industry through statistical analysis of comparable companies' R&D data and hand-sorted data on the timing of capitalization of some semiconductor companies;(3)The article calculates the net profit of the company when using different points of capitalization,and explores the impact of changes in the point of capitalization on its net profit.The article provides semiconductor companies with specific operational experience in capitalizing R&D expenditure.It can also help the semiconductor industry to improve relevant industry specifications,and provide reference for similar companies on similar issues.