Imposed Nonexchange Revenues
This type of nonexchange transaction is the result of an assessment by a government on transactions other than exchange transactions. In other words, there is no exchange transaction that gives rise to the tax. Included in this category are the following:
• Real estate taxes
• Fines and penalties
In the case of real estate taxes, a government assesses the tax based on some measure, generally the assessed value of the property. There is no exchange transaction that gives rise to the tax revenue.
Government-Mandated Nonexchange Transactions
These are transactions that occur when one level of government (including the federal government) provides resources to a government at another level (such as a state providing a city with resources) and requires that the resources be used for a specific purpose (purpose restriction) or within a specified period of time (time restriction.) Basically, this category of nonexchange transactions includes government grants. However, to be technically accurate, this category of transactions should include those that have the following characteristics:
• A government mandates that a government at another level
(the recipient government) must perform or facilitate a
particular program in accordance with the providing government’s
enabling legislation, and provides resources for
that purpose.
• There is a fulfillment of eligibility requirements (including time requirements) in order for a transaction to occur. Later in this section, the impact of purpose and time requirements and other eligibility requir ements on the accounting for these types of revenues will be discussed.
Taken From : Governmental Accounting Made Easy