{"id":5142,"date":"2014-11-05T09:42:31","date_gmt":"2014-11-05T07:42:31","guid":{"rendered":"http:\/\/www.officetodo.com\/public\/?p=5142"},"modified":"2014-11-02T09:42:57","modified_gmt":"2014-11-02T07:42:57","slug":"recognizing-grants-and-government-assistance-on-financial-statements","status":"publish","type":"post","link":"http:\/\/www.officetodo.com\/public\/recognizing-grants-and-government-assistance-on-financial-statements\/","title":{"rendered":"Recognizing grants and government assistance on financial statements"},"content":{"rendered":"

Once your company is applying for a government grant or it\u2019s being offered assistance, it\u2019s important to understand when exactly you can recognize the grant on the financial statements. Note here that accounting frameworks may differ with that regard in details, however the general principle applied is the same.\u00a0<\/p>\n

A government grant should not be recognized until there\u2019s reasonable assurance that:<\/p>\n

    \n
  1. The company will comply with the conditions attached to the grant; and<\/li>\n
  2. That the grants will be received.<\/li>\n<\/ol>\n

    A thing to remember is that the receipt of the grant in itself does not prove that the conditions attached have or will be met in the future. Compliance with the conditions is entirely up to the company and its management.<\/p>\n

    One thing to note is if the grant or assistance is tied to future conditions \u2013 i.e. you must ensure your actions are compliant for say 5 year after the grant was given to you. In such a situation the government body making the grant available may also come in years\u2019 time and perform an audit on your activities. If they find that you have not been compliant, they may ask part or the entire grant back.<\/p>\n

    So on one hand you must ensure that you\u2019re doing everything you can to get the grant and to be compliant with all conditions. On the other hand you must also ensure that you are continuously meeting those conditions throughout the period of the grant being in effect (regardless whether you already received it or you\u2019re receiving in parts).<\/p>\n","protected":false},"excerpt":{"rendered":"

    Once your company is applying for a government grant or it\u2019s being offered assistance, it\u2019s important to understand when exactly you can recognize the grant on the financial statements. Note here that accounting frameworks may differ with that regard in details, however the general principle applied is the same.\u00a0<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[68],"tags":[],"class_list":["post-5142","post","type-post","status-publish","format-standard","hentry","category-1-16-donations"],"aioseo_notices":[],"_links":{"self":[{"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/5142","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/comments?post=5142"}],"version-history":[{"count":1,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/5142\/revisions"}],"predecessor-version":[{"id":5143,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/5142\/revisions\/5143"}],"wp:attachment":[{"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/media?parent=5142"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/categories?post=5142"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/tags?post=5142"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}