GAE2612. Where are we now? Revenue and Expense Recognition Project

This session provides an overview of the recognition and measurement of revenues and expenses in the governmental space through three key model components. First, it introduces the categorization methodology, which distinguishes between Category A and Category B transactions, helping participants understand how different types of transactions are grouped based on their underlying characteristics. Second, the session explores the recognition approach applicable to Category A transactions and each Category B subtype of transactions, emphasizing the general timing principles applicable to each category. Third, it addresses measurement broadly and specifically outlines how amounts are determined, including the basis for estimating or calculating those amounts. Together, these model components provide a structured foundation for understanding how governmental entities consistently recognize and measure revenues and expenses.

Learning Objectives:

• Identify and describe the fundamental concepts and terminology related to revenue and expense recognition applicable to state and local governments.
• Recognize the defining characteristics of Category A and Category B transactions and the general principles governing their recognition and measurement in governmental financial reporting.