Ch. 16 - Government Assistance

Question 1

grants are recognized when there is reasonable assurance of two criteria:

Answer 1

1. the entity will comply with the conditions attached to the grant
2. the grant will be received

Question 2

Grants related to income - presentation options

Answer 2

1. separately as ‘other income’

2. deducted form the related expenses

Question 3

Grants related to assets - presentation

Answer 3

1. as deferred income and recognized with depreciation

2. deducted form the assets carrying value

Question 4

Government Loans

Answer 4

1. forgivable portions are included in income

2. interest below market rate is included as income

Question 5

Non-monetary grants - recognition amount

Answer 5

1. grant can be recognized at the fair value

2. grant can be recognized at a nominal value

Question 6

Disclosures

Answer 6

1. method of presentation
2. nature and extent of amounts received
3. unfulfilled conditions and outstanding contingencies

Question 7

ASPE - non-monetary grants - measurement

Answer 7

1. measured at fair value, no option for nominal amount