(P) December 16, 2028; (N) December 16, 2029
832-10-65-2An entity shall not recognize a government grant until: - a
It is probable that both of the following criteria are met: - 1
The entity will comply with the conditions attached to the government grant.
- 2
The government grant will be received.
- b
(P) December 16, 2028; (N) December 16, 2029
832-10-65-2Receipt of a government grant does not, in and of itself, provide conclusive evidence that the conditions attached to the government grant have been or will be fulfilled. A government grant receivable or liability may be recognized because of differences in the timing between when an entity receives a government grant and when the guidance in paragraph 832-10-25-1 has been met. An entity shall not recognize a receivable on the balance sheet unless and until the recognition guidance in paragraph 832-10-25-1 is met. (P) December 16, 2028; (N) December 16, 2029
832-10-65-2A forgivable loan shall be treated as a government grant when the entity meets the guidance in paragraph 832-10-25-1, including when it is probable that the entity will meet the terms for forgiveness of the loan. (P) December 16, 2028; (N) December 16, 2029
832-10-65-2An entity shall recognize a grant related to an asset on the balance sheet as the entity incurs the related costs for which the government grant is intended to compensate using either of the following approaches: - a
Separately recognize the grant as deferred income. (This is referred to as the deferred income approach.)
- b
Reflect the grant as an adjustment to the cost basis in determining the carrying amount of the asset. (This is referred to as the cost accumulation approach.)
(P) December 16, 2028; (N) December 16, 2029
832-10-65-2A grant related to an asset that is accounted for using the deferred income approach shall be recognized in earnings on a systematic and rational basis over the periods in which the entity recognizes as expenses the related costs for which the government grant is intended to compensate. The expenses that are recognized for a grant related to an asset could include depreciation, gain or loss on sale, or impairment. (P) December 16, 2028; (N) December 16, 2029
832-10-65-2A government grant related to a nondepreciable asset that is accounted for using the deferred income approach shall be subsequently recognized in earnings on a systematic and rational basis over the periods in which the entity incurs the costs to which the grant relates. (P) December 16, 2028; (N) December 16, 2029
832-10-65-2For a grant related to an asset that is accounted for using the cost accumulation approach, there is no separate subsequent recognition of the government grant proceeds in earnings because they have been reflected in the carrying amount of the asset. The carrying amount of the asset that includes the government grant proceeds shall be used to determine depreciation or other subsequent accounting for that asset. (P) December 16, 2028; (N) December 16, 2029
832-10-65-2A government grant may take the form of a transfer of a tangible nonmonetary asset, such as land or other resources. The receipt of a tangible nonmonetary asset that is determined to be a grant related to an asset shall be recognized in accordance with paragraphs and measured in accordance with paragraph 832-10-30-1. (P) December 16, 2028; (N) December 16, 2029
832-10-65-2A grant related to income shall be recognized in earnings on a systematic and rational basis over the periods in which the entity recognizes as expenses the related costs for which the grant is intended to compensate. (P) December 16, 2028; (N) December 16, 2029
832-10-65-2A grant related to income that provides an entity with compensation for expenses or losses previously incurred or for the purpose of giving immediate financial support to the entity with no future related costs shall be recognized in earnings in the period in which the entity meets the guidance in paragraph 832-10-25-1.