sic-10_2026

SIC Interpretation 10

Government Assistance—No Specific Relation to Operating Activities

(SIC‑10)

is set out in

paragraph 3

. SIC‑10 is accompanied by a

Basis for Conclusions

. The scope and authority of Interpretations are set out in the

Preface to IFRS Accounting Standards

FOR THE BASIS FOR CONCLUSIONS, SEE PART C OF THIS EDITION

SIC Interpretation 10

Government Assistance—No Specific Relation to Operating Activities

References

IAS 8

Basis of Preparation of Financial Statements

IAS 20

Accounting for Government Grants and Disclosure of Government Assistance

Issue

In some countries government assistance to entities may be aimed at encouragement or long‑term support of business activities either in certain regions or industry sectors. Conditions to receive such assistance may not be specifically related to the operating activities of the entity. Examples of such assistance are transfers of resources by governments to entities which:

(a)

operate in a particular industry;

(b)

continue operating in recently privatised industries; or

(c)

start or continue to run their business in underdeveloped areas.

The issue is whether such government assistance is a ‘government grant’ within the scope of

IAS 20

[

Refer:

IAS 20 paragraphs 1 and 2

]

and, therefore, should be accounted for in accordance with this Standard.

Consensus

Government assistance to entities meets the definition of government grants in

IAS 20

, even if there are no conditions specifically relating to the operating activities of the entity other than the requirement to operate in certain regions or industry sectors. Such grants shall therefore not be credited directly to shareholders’ interests.

[

Refer:

Basis for Conclusions paragraph 4

]

Date of consensus

January 1998

Effective date

This Interpretation becomes effective on 1 August 1998. Changes in accounting policies shall be accounted for in accordance with

IAS 8