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Where the amount refundable is in respect of a government grant related to revenue, the refund is
applied first against any unamortised deferred credit remaining in respect of the grant. Rest amount
of refund should be charged to profit and loss account.
Where, the amount refundable is in respect of promoter’s contribution, the capital reserve should
be reduced by the amount refundable.
Contingency related to Govt. Grant
A contingency related to Govt. grant receivable and refundable should be treated in accordance
with AS-4.
Disclosures:
The accounting policy adopted
The nature and extent of gov. grants recognised in the financial statements.
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