As per 'AS 26-Intangible Assets' cost incurred in development phase of a project can be treated as intangible assets if future economic benefits from assets are probable. This is because the development phase of a project is further advanced than the research phase.

The followings are the examples of development activities/costs:

• Costs of the design, construction and testing of pre-production:
• Costs of the design of tools, jigs, moulds and dies involving new technology;
• Costs of the design, construction ad operation of a pilot plant that is not of a scale economically feasible for commercial production; and
• Costs of the design, construction and testing of a chosen alternative for new or improved materials, devices, products, processes, systems or services.”