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There are 2 methods for recognising Grant, right?
1/ Grant related to Asset:
I learn that Grant should be deferred and amortize over useful life of Asset. However,
Can we deduct the CV of Asset by the amount of Grant?2/ Grant related to Income:
I learn that Grant should be deferred and released when actual expensed related incurred. However,
Can we recognize income immediately upon receipt?Hi,
1) Yes, you can use either method but the deferred income method is more common.
2) Yes, you can recognise it immediately if the criteria have been met and the expense has already been incurred.
Thanks
2. It sounds like if there is certain expenses incurred, and we receive Grant after that, we should recognise in profit/loss the same amount as to match it in the sane accounting period. The remaining should be deferred.
However, if we receive Grant in advance, we should defer it until future expenses incurs so that we can release deferred income to profit/loss by the same amount of expenses.
Can u clarify if what I know is correct?
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