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[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section admin_label=”Section” fullwidth=”off” specialty=”off”][et_pb_row admin_label=”Row”][et_pb_column type=”1_2″][et_pb_text admin_label=”Text” background_layout=”light” text_orientation=”center” text_font_size=”14″ use_border_color=”off” border_color=”#ffffff” border_style=”solid”] [button link=”http://www.frs102.com/members/premium-toolkit/” type=”big” color=”red”] Return to Main Index[/button] [/et_pb_text][/et_pb_column][et_pb_column type=”1_2″][et_pb_text admin_label=”Text” background_layout=”light” text_orientation=”center” text_font_size=”14″ use_border_color=”off” border_color=”#ffffff” border_style=”solid”] [button link=”https://uk.frs102.com/members/premium-toolkit/section-34/” type=”big” color=”red”] Return to Section 34 Home[/button] [/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section admin_label=”Section” fullwidth=”off” specialty=”off” transparent_background=”off” allow_player_pause=”off” inner_shadow=”off” parallax=”off” parallax_method=”off” padding_mobile=”off” make_fullwidth=”off” use_custom_width=”off” width_unit=”on” make_equal=”off” use_custom_gutter=”off” gutter_width=”3″][et_pb_row admin_label=”Row”][et_pb_column type=”4_4″][et_pb_text admin_label=”Main Body Text” background_layout=”light” text_orientation=”justified” use_border_color=”off” border_color=”#ffffff” border_style=”solid”]Public benefit entities: Incoming Resources from Non-Exchange Transactions
Extract from FRS102: Section PBE34.64-.PBE34.74
PBE34.64 The accounting for government grants is addressed in Section 24 Government Grants.
PBE34.65 Paragraphs PBE34.67 to PBE34.74 and the accompanying guidance at Appendix B to this section apply to other resources received from non-exchange transactions by public benefit entities or entities within a public benefit entity group. A non-exchange transaction is a transaction whereby an entity receives value from another entity without directly giving approximately equal value in exchange or gives value to another entity without directly receiving approximately equal value in exchange.
PBE34.66 Non-exchange transactions include, but are not limited to, donations (of cash, goods, and services) and legacies
Recognition and measurement
PBE34.67 An entity shall recognise receipts of resources from non-exchange transactions as follows:
(a) Transactions that do not impose specified future performance-related conditions on the recipient are recognised in income when the resources are received or receivable.
(b) Transactions that do impose specified future performance-related conditions on the recipient are recognised in income only when the performance-related conditions are met.
(c) Where resources are received before the revenue recognition criteria are satisfied, a liability is recognised.
PBE34.68 The existence of a restriction does not prohibit a resource from being recognised in income when receivable.
PBE34.69 When applying the requirements of paragraph PBE34.67, an entity must take into consideration whether the resource can be measured reliably and whether the benefits of recognising the resource outweigh the costs.
PBE34.70 Therefore, where it is not practicable to estimate the value of the resource with sufficient reliability, the income shall be included in the financial period when the resource is sold.
PBE34.71 An entity shall recognise a liability for any resource that has previously been received and recognised in income when, as a result of a subsequent failure to meet restrictions or performance-related conditions attached to it, repayment becomes probable.
PBE34.72 Donations of services that can be reasonably quantified will usually result in the recognition of income and an expense. An asset will be recognised only when those services are used for the production of an asset and the services received will be capitalised as part of the cost of that asset.
PBE34.73 An entity shall measure incoming resources from non-exchange transactions as follows:
(a) Donated services and facilities that would otherwise have been purchased, shall be measured at the value to the entity.
(b) All other incoming resources from non-exchange transactions shall be measured at the fair value of the resources received or receivable.
Disclosure
PBE34.74 An entity shall disclose the following:
(a) the nature and amounts of resources receivable from non-exchange transactions recognised in the financial statements;
(b) any unfulfilled conditions or other contingencies attaching to resources from non-exchange transactions that have not been recognised in income; and
(c) an indication of other forms of resources from non-exchange transactions from which the entity has benefited.
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