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I have two questions:
1. If a grant is received for a depreciable asset are we allowed to use the net method where we credit the full amount of grant/deferred grant to asset account and then depreciate the balance carrying amount over the life of the asset?
2. if a grant is returned, where do we show it on statement of cash flows, under which activity?
Hi,
1. IAS 20 allows both approaches, but netting-off is prohibited by company law in many jurisdictions.
2. It would be shown in the same place as where the receipt was recorded.
Thanks
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