• Market Administration
• Operation of Cemetery
3.3 Revenue recognition
Revenue from non-exchange transactions
Taxes, fees, and fines
The LGU recognizes revenues from taxes and fines when the event occurs and
the asset recognition criteria are met to the extent that there is a related condition
attached that would give rise to a liability to repay the amount, liability is
recognized instead of revenue. Other non-exchange revenues are recognized
when it is improbable that the future economic benefit or service potential
associated with the asset will flow to the entity and the fair value of the asset
can be measured reliably.
Transfers from other government entities
Revenues from non-exchange transactions with other government entities are
measured at fair value and recognized on obtaining control of the asset (cash,
goods, services and property) if the transfer is free from conditions and it is
probable that the economic benefits or service potential related to the asset will
flow to the LGU and can be measured reliably.
Revenue from exchange transactions
Rendering of services
The LGU recognizes revenue from the rendering of services by reference to the
stage of completion when the outcome of the transaction can be estimated
reliably. The stage of completion is measured by reference to labor hours
incurred to date as a percentage of total estimated labor hours. Where the
contract outcome cannot be measured reliably, revenue is recognized only to
the extent that the expenses incurred.
Sale of goods
Revenue from the sale of goods is recognized when the significant risks and
rewards of ownership have been transferred to the buyer, usually on delivery of
the goods and when the amount of revenue can be measured reliably and it is
probable that the economic benefits or service potential associated with the
transaction will flow to the LGU.
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