Accounting Q&A · Government Accounting · Topic 8
Practise 25 government accounting questions on taxes, transfers and binding arrangements using five worked public-sector cases. Try each answer before revealing it. The cases are illustrative. Check the applicable reporting framework and local budget rules.
A government receives an unrestricted cash transfer of 100,000
1. What should the accountant establish?
Assess control, recognition and whether a binding arrangement exists under the applicable framework.
2. What evidence should be obtained?
Obtain payment evidence and transfer terms.
3. What calculation or procedure would help?
Check whether any enforceable obligations or other liabilities accompany the receipt.
4. What limitation or alternative matters?
The label grant alone does not determine recognition timing.
5. What should happen next?
Record the receipt and document the revenue conclusion.
An agency receives 60,000 under a binding arrangement to deliver training
6. What should the accountant establish?
Identify enforceable compliance obligations under IPSAS 47 if applicable.
7. What evidence should be obtained?
Gather the agreement and delivery records.
8. What calculation or procedure would help?
Assess when obligations are satisfied and recognise revenue accordingly.
9. What limitation or alternative matters?
Cash can be received before obligations are satisfied.
10. What should happen next?
Reconcile cash, any liability and recognised revenue.
Taxes of 120,000 are collected and qualifying receivables rise by 15,000
11. What should the accountant establish?
Distinguish collections from accrual recognition.
12. What evidence should be obtained?
Collect assessment and receivable movement schedules.
13. What calculation or procedure would help?
Calculate 135,000 if there are no other movements and recognition criteria are met.
14. What limitation or alternative matters?
Write-offs and prior-period adjustments change the reconciliation.
15. What should happen next?
Document the taxable events and reconcile revenue.
Donated equipment is received for public use
16. What should the accountant establish?
Assess asset recognition and associated revenue or liability.
17. What evidence should be obtained?
Obtain donation terms, condition records and valuation evidence.
18. What calculation or procedure would help?
Apply the relevant asset and revenue standards to the facts.
19. What limitation or alternative matters?
A donor’s quoted figure may not be the applicable measurement.
20. What should happen next?
Document the measurement basis and any obligations.
A learner uses IPSAS 23 for a period subject to IPSAS 47
21. What should the accountant establish?
Check the applicable standard and transition rules.
22. What evidence should be obtained?
Obtain the reporting dates and local adoption requirements.
23. What calculation or procedure would help?
Confirm IPSAS 47’s effective date and its replacement of IPSAS 23 for applicable periods.
24. What limitation or alternative matters?
Local implementation can differ from the IPSASB timetable.
25. What should happen next?
Use the applicable standard and explain transition effects.