A school district is the recipient of an expenditure-driven grant of $40,000 from the state that is to pay for teacher training on new technologies. The school district spends the $40,000 for the teacher training in the current fiscal year but does not receive the $40,000 until the fourth day of the school district's next fiscal year. The school district should report $40,000 as intergovernmental grant revenue in its current fiscal year-end statement of revenues, expenditures, and changes in fund balance for its Special Revenue Fund.

Question

Quizplus · Accepted Answer

Revenue is recognized for an expenditure-driven grant when the eligibility requirements are met and the resources are available. In this case, the school district spent the money on the required teacher training in the current fiscal year and the resources should be available as they are collected only four days into the next fiscal year. Therefore, intergovernmental grant revenue should be recognized in the current fiscal year.

A School District Is the Recipient of an Expenditure-Driven Grant