# ASC 832-10-55: Government Assistance — Overall — 55 Implementation Guidance and Illustrations Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/832/10/#55-implementation-guidance-and-illustrations) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:fc0062fe700b727d9ab04f8657ef38515a748fba73771b44735143a2ea570c09 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 832-10-55: 55 Implementation Guidance and Illustrations [Read section](https://asc.understandingaccounting.org/asc/832/10/#55-implementation-guidance-and-illustrations) SEC content: no ##### [832-10-55-1](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-1) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:0f220a04a014e71d856e989a487ef156e10d3525d82c02e97ecef59800f38ff4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)The Implementation Guidance and Illustrations Section is organized as follows: 1. a Implementation guidance is provided in paragraphs [832-10-55-2 through 55-7](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-2) . 2. b Illustrations are provided in paragraphs [832-10-55-8 through 55-14](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-8) . #### Implementation Guidance ##### [832-10-55-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-2) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:1d2e48614c14bd3dd831ea930971d84bb1b4e2546e0c43c84724c3a8556b59d7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)Paragraphs [832-10-55-3 through 55-14](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-3) are an integral part of this Topic. These paragraphs provide additional guidance that addresses the application of the guidance on [government grants](https://asc.understandingaccounting.org/glossary/g/#government-grant "(P) December 16, 2028; (N) December 16, 2029832-10-65-2A transfer of a monetary asset or a tangible nonmonetary asset, other than in an exchange transaction (including an exchange transaction that may be at a significant discount to fair value), from a government to an entity except for a not-for-profit entity and an employee benefit plan within the scope of Topics 960, 962, and 965 on plan accounting."). ##### [832-10-55-3](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-3) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:063441589810bfda3d1ed8308dbbf24cebe0d168f3e4bd4a2f88d0567e9b2b64 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)Different terms can be used to describe various types of government assistance (for example, grants, awards, or subsidies). Therefore, an entity should consider the individual facts and circumstances to determine whether assistance received from a government meets the definition of a government grant and, therefore, is within the scope of this Topic. ##### [832-10-55-4](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-4) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:1fee42e7ff5780d1425bcdf67d621ddd4a58521aad8cdc84331a79d4b24eacd2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)A government grant is received in the form of a [monetary asset](https://asc.understandingaccounting.org/glossary/m/#monetary-assets "Money or a claim to receive a sum of money the amount of which is fixed or determinable without reference to future prices of specific goods or services.") or a tangible nonmonetary asset from a government. Examples of a government grant include the following: 1. a A transfer of cash to fund future expenditures or reimburse expenditures already incurred (for example, capital expenditures, wages, training and other employee-related costs, research and development expenses, or other operating expenses) 2. b A transfer of a tangible nonmonetary asset such as a long-lived asset (for example, a building, land, or equipment) 3. c The proceeds of a [forgivable loan](https://asc.understandingaccounting.org/glossary/f/#forgivable-loan "(P) December 16, 2028; (N) December 16, 2029832-10-65-2A loan for which the lender agrees to waive repayment under certain prescribed conditions established by a government.") when an entity meets the guidance in paragraph [832-10-25-1](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-1), including when it is probable that the entity will meet the terms for forgiveness of the loan 4. d A refundable tax credit that is not within the scope of Topic 740 on income taxes. ##### [832-10-55-5](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-5) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:a2ce8a5d3d67ca58ba03b0ecbf08f7fd48908a74b85838918263f4b062c0d96e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)The scope of the guidance in this Topic is limited to government grants and, therefore, excludes the following: 1. a The transfer of an intangible asset or provision of a service 2. b A reduction of an entity’s liabilities (for example, sales, property, payroll, or other tax abatement) 3. c Government participation in the ownership of an entity 4. d A contribution to a business entity from a nongovernmental source within the scope of Subtopic 958-605 on not-for-profit entities—revenue recognition 5. e A transaction within the scope of Topic 606 on revenue from contracts with customers or Subtopic 610-20 on other income—gains and losses from the derecognition of nonfinancial assets. ##### [832-10-55-6](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-6) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:bd8c1ea46353cbccfa66837f591a79c10253a268d06dab83217f8fc866b0a886 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)In most cases, the period over which an entity recognizes the costs or expenses related to a government grant is readily ascertainable. Thus, a government grant that is intended to reimburse specific expenses should be recognized in earnings on a systematic and rational basis over the periods in which the entity recognizes the relevant expenses. Similarly, a government grant related to a depreciable asset that is accounted for using the deferred income approach in accordance with paragraph [832-10-25-4(a)](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-4) should be recognized in earnings on a systematic and rational basis over the periods in which depreciation expense on that asset is recognized (in the absence of impairment or disposal). ##### [832-10-55-7](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-7) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:16f986480f1b548de22650fcb0e985c93202fca2588e25b16da41870726bca64 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)Government grants may be received as part of a package of financial or fiscal aid that contains a number of conditions. In such cases, judgment is needed to identify the conditions related to the costs that determine the periods over which the government grant will be recognized. #### Illustrations ##### [832-10-55-8](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-8) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:1f5ea248d8dfacc29d9abaaff8c08344bd247d35528e2a391a2f646eaf0ee3a2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)Entity A is awarded a government grant of $5 million to assist with the cost of purchasing a building, which is the only condition attached to the grant. The government grant proceeds will be received after the purchase of the building. When the building is purchased, Entity A has incurred the related costs for which the government grant is intended to compensate and determines that the probable criteria in paragraph [832-10-25-1(a)(1) through (a)(2)](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-1) have been met. The building has a useful life of 40 years. ##### [832-10-55-9](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-9) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:0dcd7e25ec716a6da960269a9abb9995e83625e20634ff319e3fa7677c68948e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)Entity A can elect to recognize the government grant as deferred income on the balance sheet using the deferred income approach in accordance with paragraph [832-10-25-4(a)](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-4) or reflect the government grant as an adjustment to the cost basis in determining the carrying amount of the building using the cost accumulation approach in accordance with paragraph [832-10-25-4(b)](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-4). ##### [832-10-55-10](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-10) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:05e6aab6a83a14719cef6b8a36ae4047f985413ac270029fa94d757b42237337 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)If Entity A elects the deferred income approach, it should recognize the government grant as deferred income. Once the building is placed into service, Entity A begins recognizing the government grant of $5 million in earnings on a systematic and rational basis over the 40-year period in proportion to the depreciation expense recognized in accordance with paragraphs [832-10-25-5](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-5) and [832-10-55-6](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-6). Entity A may elect to present the grant in earnings either separately under a general heading such as other income or deducted from the related expense (for example, depreciation). Entity A should revise the pattern of recognition if the building is disposed of or impaired. ##### [832-10-55-11](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-11) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:8657a248da5199cfe966a3d3b199cf426232e0e1be2d378494f07cc0adb67f6d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)If Entity A elects the cost accumulation approach, it should reflect the government grant as an adjustment to the cost basis in determining the carrying amount of the building. Once the building is placed into service, there is no subsequent separate recognition of the government grant proceeds in earnings. The carrying amount of the building, which reflects the government grant proceeds, should be used to determine the depreciation expense or subsequent accounting in accordance with paragraph [832-10-25-7](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-7). ##### [832-10-55-12](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-12) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:8bf53d879c1a5917943d20f02fd96d78f77e6d79c672079643fcbc9d94451c79 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)Entity B is awarded a government grant of $2 million for qualifying expenditures associated with the research and development of a new drug. Entity B will receive cash from the government on a cost-reimbursement basis by submitting proof that it has incurred qualifying expenditures. Entity B determines that the probable criteria in paragraph [832-10-25-1(a)(1) through (a)(2)](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-1) have been met because it is probable that it will comply with the condition of the government grant (to incur qualifying expenditures) on the basis of its detailed project plan and budget and that the grant will be received. ##### [832-10-55-13](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-13) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:6d8e9af1bd21800d54eaa9f60530a15e2716539f3dfe52271183f29eac1cd2ad Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)Entity B incurs the qualifying expenditures associated with the research and development of a new drug over a 2-year period and recognizes the government grant of $2 million on a systematic and rational basis over the 2-year period as those costs are incurred in accordance with paragraphs [832-10-25-9 through 25-10](https://asc.understandingaccounting.org/asc/832/10/#832-10-25-9) and [832-10-55-6](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-6). No government grant proceeds would be recognized in earnings until Entity B incurs the related expenses. In addition, a receivable would not be recognized on the balance sheet unless and until Entity B incurs the qualifying expenditures associated with the research and development of a new drug. ##### [832-10-55-14](https://asc.understandingaccounting.org/asc/832/10/#832-10-55-14) Pending content: yes Source downloaded (UTC): 2026-09-10T01:48:35.308Z to 2026-09-10T01:48:35.308Z Record version: sha256:1645ac34f40a59e8d278ceb45b7412cf392fcc433370183feb3cfa6e22a36531 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Transition date:(P) December 16, 2028; (N) December 16, 2029Transition guidance: [832-10-65-2](https://asc.understandingaccounting.org/asc/832/10/#832-10-65-2)Entity B can elect to present the government grant proceeds either separately under a general heading such as other income in accordance with paragraph [832-10-45-3(a)](https://asc.understandingaccounting.org/asc/832/10/#832-10-45-3) or as a deduction from the related expenses in accordance with paragraph [832-10-45-3(b)](https://asc.understandingaccounting.org/asc/832/10/#832-10-45-3).