Accounting of governemnt grants

This query is : Resolved

vijay (Querist)
Follow

07 December 2012 company has received government grants in connection with depreciable asset. how account income for the year

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
Follow

07 December 2012 Accounting Standard -12

1. Government grants related to specific fixed assets should be
presented in the balance sheet by showing the grant as a deduction
from the gross value of the assets concerned in arriving at their book
value.
.

2.Where the grant related to a specific fixed asset equals the whole,
or virtually the whole, of the cost of the asset, the asset should be shown
in the balance sheet at a nominal value.
.
3.Alternatively, government grants
related to depreciable fixed assets may be treated as deferred income
which should be recognised in the profit and loss statement on a
systematic and rational basis over the useful life of the asset, i.e., such
grants should be allocated to income over the periods and in the
proportions in which depreciation on those assets is charged.
.

vijay

vijay (Querist)
Follow

08 December 2012 Many Many Thanks To You.But you have more information please send to me.

Thanks & regards
Vijay.