The elements of governmental financial accounting include assets, liabilities, net assets, revenues, and expenses (owner's equity is replaced with net assets and there is no profit). Measurement attributes of government assets primarily include historical cost, replacement cost, present value, fair value, and nominal amount (net realizable value is replaced with nominal amount). The measurement attributes of government liabilities primarily include historical cost, present value, and fair value. Government budgetary accounting elements include budgetary revenues, budgetary expenditures and budgetary balances.
Government final report, using budget accounting, using the cash basis; government financial report, using financial accounting, using the accrual basis. All levels of government refers to all levels of government finance department, specifically responsible for the accounting of financial general accounting. Departments and units refer to state organs, armies, political party organizations, social organizations, institutions and other units that have direct or indirect budgetary appropriation relationships with the financial departments of the government at this level. The army, units that have been incorporated into the financial management system of enterprises and social organizations that implement the Accounting System for Civil Non-profit Organizations are not applicable to the Basic Standard.
Expanded InformationThe accounting treatment of financial incentive payments is based on the provisions of "Accounting Standard for Business Enterprises No. 16 - Government Grants" for accounting treatment: Article 7 Government grants related to assets shall be recognized as deferred income and allocated equally over the useful life of the relevant assets and recognized in profit or loss for the current period.
Article VIII government grants related to income shall be handled as follows:
(1) If they are used to compensate for the relevant expenses or losses of the enterprise in the subsequent period, they shall be recognized as deferred income and shall be credited to current profit and loss in the period in which the relevant expenses are recognized.
(ii) If used to compensate for the relevant expenses or losses already incurred by the enterprise, they are recognized directly in profit or loss of the current period.
Tax treatment: If this financial incentive meets the conditions of non-taxable income stipulated in the document Cai Shui [2011] 70, the company can treat it as non-taxable income.
According to the provisions of Article 28 of the Implementation Regulations, the above non-taxable income shall not be deducted from the calculation of taxable income if it is used for expenses; and the depreciation and amortization of assets used for expenses shall not be deducted from the calculation of taxable income.
If this part of the financial incentive payment does not qualify as non-taxable income, the company should include it once in the current taxable income when it receives it.
Baidu Encyclopedia - A Complete List of Commonly Used Accounting Entries