Indian Accounting Standard (Ind AS) 20, Accounting for Government Grants and Disclosure of Government Assistance, Important Material
Ind AS 20: Accounting for Government Grants and Disclosure of Government Assistance
Grants may be known as subsidies, subventions or premiums. Entities may also receive other types of assistance which may be in many other forms.
These are mainly intended to encourage entities to initiate activities that they would not have otherwise undertaken.
Government grant/assistance is an action by the government to providing economic benefits specific to an entity or range of entities qualifying certain criteria.
Ind AS-20 deals with the accounting treatment and disclosure requirements of grants received by entities from government. It also mandates disclosure requirements of other forms of government assistance.
(a) Special problems in relation with the effects of changing prices on financial statements or similar supplementary information.
(b) Government assistance provided in the form of tax benefits (including income tax holidays, investment tax credits, accelerated depreciation allowances, and concessions in tax rates)
(c) Government participation in the ownership
(d) Government grants covered by Ind AS-41.