accounting on govt. grant
This query is : Resolved
10 January 2011
A company receive a govt. grant of Rs 1.00 crore.In this Rs 70.00 lacs for capital expenditure and Rs 30.00 lacs for revenue expenditure.what is the treatment in books of accounts of company?
Vivek Raju P
(Expert)
10 January 2011
Depends on the conditions attached to the grant..
For revenue unless the conditions specified in the grant are fully met or there is no uncertanity of meeting the conditions specified for the grant the entire revenue can be recognised.
In case of the capital grant used to purchase fixed assets, they may be recorded at nominal cost.
For revenue unless the conditions specified in the grant are fully met or there is no uncertanity of meeting the conditions specified for the grant the entire revenue can be recognised.
In case of the capital grant used to purchase fixed assets, they may be recorded at nominal cost.
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