What is often the result of internally developed patents in terms of financial reporting?

Internally developed patents are typically not recorded as assets on the balance sheet due to the accounting principles that govern the recognition of intangible assets. Generally accepted accounting principles (GAAP) require that for an intangible asset to be recognized, it must meet specific criteria that often relate to acquisition costs. Since internally developed patents involve significant research and development costs incurred before the patent is granted, these costs are usually expensed as incurred rather than capitalized as an asset. This results in the absence of these patents on the balance sheet until they are actually granted and have identifiable economic benefits that can be reliably measured. Thus, the correct answer reflects the accounting treatment that prevents these internally generated assets from being recorded on the balance sheet.