Government Grant Accounting (2025 BDO Comment Letter)
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In November 2024, the FASB proposed guidance that would establish the accounting for government grants received by business entities. Today, U.S. GAAP does not include specific guidance on this topic. As a result, many businesses apply International Accounting Standard (IAS) 20, Accounting for Government Grants and Disclosure of Government Assistance, by analogy, to account for government grants.
In our comment letter, BDO generally supports the Board’s proposal to develop authoritative guidance on accounting for government grants received by business entities. BDO suggests reducing the optionality provided by the proposed amendments and expanding them to address certain application issues.