Matching Principle Violation

Steps:

• Recall matching principle: expenses recognized in period they generate related revenues.
• Assess A: capitalizing intangible staff expertise mismatches as it's not a verifiable asset cost.
• Assess B, C, D: each properly defers or accrues costs to align with revenue periods.
• Conclude A incorrectly applies by treating non-capitalizable expertise as amortizable asset.

Why A is correct:

• Matching requires expenses from acquired resources; staff expertise is inherent human capital, not a balance sheet asset per accounting standards like IAS 38, preventing arbitrary capitalization.

Why the others are wrong:

• B: Unused stationery is inventory asset until consumed, matching usage to revenue period.
• C: Bad debt provision matches credit sales expense to sales revenue year.
• D: Accrued telephone costs match incurred expense to service period, regardless of billing.

Final answer: A