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Characteristics of Deferred Revenue

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The term deferred revenues seems out of place in governmental fund accounting. It would seem that a government either has or does not have expendable financial resources as a result of property tax, grant, or other revenue transaction. Furthermore, no similar concept, such as deferred working capital, is used in business accounting. Explain the use of the term deferred revenues in governmental fund accounting.

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This solution describes characteristics of deferred revenue.

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In respect to governmental fund accounting, deferred revenues would include taxes and other funding that the government has received from taxpayers that are set aside for services that are owed to taxpayers, which would make ...

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  • Master of Public Administration, North Carolina Central University
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