alleryStart learning →A grant compensates losses already incurred. When is it recognised?
ASpread over five years
BDeferred till the write-off
COver the life of all assets
DWhen it becomes receivable
Answer & Solution
Correct answer: D. When it becomes receivable
A grant compensating past expenses or losses has no future related costs, so it is taken in the period it becomes receivable.
Keep practising Ind AS 20 Government Grants and Ind AS 41 Agriculture
Browse all Ind AS 20 Government Grants and Ind AS 41 Agriculture questions for CA Final, or explore more Financialreporting topics.
Related questions
When valuing a below-market government loan benefit, what must the entity consider?Why do income approach supporters reject crediting grants directly to equity?Which view backs the income approach as per Ind AS 20?How many broad approaches to accounting for government grants does Ind AS 20 describe?Why is information on government assistance useful to financial statement users?Why does government typically give grants according to Ind AS 20?Which grape-related step is outside Ind AS 41?Which activity is listed as agricultural activity in Ind AS 41?