If a government receives donations of works of art, the government must recognize revenue in its government-wide financial statements

Question

Quizplus · Accepted Answer

Governments must recognize revenue in their government-wide financial statements for all donations of works of art, regardless of whether they elect to capitalize their collections or not. This is because government-wide financial statements are prepared on the accrual basis of accounting, which requires the recognition of revenue when it is earned, including donations of works of art.

If a Government Receives Donations of Works of Art, the Government