NAME: SOPHIA GABUAT

SECTION: CBET-01-601P

REVENUE AND OTHER RECEIPTS

1. What government receipts spark your interest? Why?

Revenue talks about the gross inflow of economic benefits or service potential during the
reporting period when those inflows result in an increase in net assets /equity, other than
increases relating to contributions from owners. And basing on the previous reports which
specifically our group report presentation (Chapters 2, 3 and 4), I learned that in taxes it is not
pure accrual basis, although the objectives of the government is to use accrual basis of
accounting but as I search to it, there are still more to know. This information triggers and arise
my interest in a particular government receipts. As I search to the list of the government receipts,
I find it a more difficult to find a certain information that might help me because Google directs
me to a lot of long list or files with hundreds of pages but as I try to look up to the book of Dayag
which is his 2021 edition of Advanced Accounting, I saw the Statement of Comparison of
Budget and Actual Amount that includes or contains list of receipts and it gives me more interest
that tax revenue are included in that. Although, I know most of us will choose this receipt but
what is unique for me is that, I am interested to this because according to tutorial that I’ve
watched, it asks there if it conforms in accrual basis of accounting or if we accrue it? But, it’s
says that it is not. We will record it when we receive not when accrue. But, according to the
video tutorial that there is instances that we can record Tax receivables even there are still no
cash receives, we can record tax receivables when there is an assessment since the BIR knows
how much will the receivables be. In the video, it uses an example which is the Tax-Revenue
Properties. The example that the video tutorial says is included in the Revenue from non –
exchange transactions which are derived mostly from taxes, gifts and donations, goods in kind
and fines, and penalties.

As we see, the recognition of the revenue from the non – exchange transactions, the cash
basis shall be applied in all the government agencies. Therefore, assets and the corresponding
revenue or liability that arises to this transaction shall be recognized when collected or when
these are measurable and legally acceptable as we say earlier about the assessment.

2. What is your take away from this chapter? Why?

Simply, my take away in this chapter is that, even though government accounting
conforms in accrual basis of accounting, we must take note that there are still transactions that
might be in form of cash basis of accounting because we must be careful to record an income (or
revenue) when we cannot collect it in the end because it will just cause us to record impairment
loss or allowance for doubtful accounts.