Grant repayment file: Grant B deducted from the asset

Context

Brasserie Lavandou SA (fictitious entity) closes its books on 31 December 20X5. A region notifies it at the closing date that three grants received must be repaid: an equipment grant presented as deferred income (A), an equipment grant deducted from the carrying amount of the asset (B) and a training grant recognised as income in 20X4.

Assignment

Grant repayment file

Purpose of the workpaper

For each grant that became repayable (one instance per original presentation method), describe the notification, enter the amount to be repaid and, depending on the method, the deferred income not yet released (deferred income method) or the recalculated depreciation and the depreciation already recognised (deduction method). Compute the surplus to be expensed or the catch-up depreciation, reconcile the deferred income, assess the impairment of the new carrying amount and prepare the entry.

Questions of the file covered by this workpaper

• Compute the immediate expense for A (cumulative releases already recognised) and for the training grant.
• Compute the catch-up depreciation of B.
• Reconcile the deferred income of A.
• Does the new carrying amount of B call for an impairment loss? Justify.
• Record the three repayments.

• ContractNotification from the regionOpen
• ScheduleDeferred income register of AOpen
• ScheduleIAS 16 register of BOpen
• ExtractValuation of BOpen
• MemoCommunication quoteOpen