[Anonymous]

I am having trouble understanding how to record donated assets for governmental accounting (not NFP).
Only donated capital assets are recorded at cost and others at FV?

From NINJA FAR Book:

“Donated capital assets, donated works of art, historical treasures, and capital assets received in a service concession arrangement are measured at acquisition value.”

“General capital assets purchased or constructed by a government usually are recorded at the purchase of construction cost. However, assets donated to the government are recorded at fair market value when donated.”

[Wannafree]

Capital Asset Donations
GASB 33, paragraph 7d, defines a donation as a voluntary non-exchange transaction entered into willingly by two or more parties. Both parties may be governments or one party may be a nongovernmental entity, including an individual. A voluntary contribution of resources (capital assets) between state agencies is an interagency transfer of capital assets, not a donation. For more information see Sale, Disposal or Interagency Transfer of Capital Assets.
Use the acquisition value to report donated capital assets (as required by GASB 72, paragraph 79).
There are different scenarios for treatment of donated assets.
1.Scenario 1 :If donated assets are for Governtmental activities
Capital Asset Donations
GASB 33, paragraph 7d, defines a donation as a voluntary non-exchange transaction entered into willingly by two or more parties. Both parties may be governments or one party may be a nongovernmental entity, including an individual. A voluntary contribution of resources (capital assets) between state agencies is an intra agency transfer of capital assets, not a donation. For more information see Sale, Disposal or Intra agency Transfer of Capital Assets.
Use the acquisition value to report donated capital assets (as required by GASB 72, paragraph 79).
Scenarios 2 :If donated assets are for Business activities ( of Govt ) ,almost similar substitute govt wide to fund account.
Promise to donate
Scenario 3:Promise to donate ( governmental activities)
Promises are recognized as receivables and revenues (net of estimated uncollectible amounts) on the government-wide financial statements when all applicable eligibility requirements are met, provided the promise is verifiable and the resources are measurable and probable of collection.
Scenario 4:Promise to donate ( business activities )
Promises are recognized as receivables and revenues (net of estimated uncollectible amounts) on the fund financial statements when all applicable eligibility requirements are met, provided the promise is verifiable and the resources are measurable and probable of collection.
I hope it will help.

WannaB

[Author]

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