Page 14 University of Technology, Jamaica Notes to the Financial Statements 31 March 2020 (expressed in Jamaican dollars unless otherwise indicated) 2. Summary of Significant Accounting Policies (Continued) (n) Capital grants Capital grants comprise the following: (i) The cost less accumulated depreciation of, plant and equipment donated to the University, and (ii) Amounts granted to the University subject to conditions that must be met, the primary condition being that the grant must be used for the acquisition or construction of property, plant and equipment. The amounts meeting conditions include sums received for the purchase of property, plant and equipment and the fair value of buildings donated. For each reporting period, an amount equivalent to the depreciation charge on the relevant property, plant and equipment for that period is transferred from capital grants as a credit to income. (o) Grants for specified projects The University receives grants for specified projects. Grants that are governed by donor-imposed stipulations, which stipulations must be complied with to the satisfaction of the donor for the project expenditure to be approved, are, until spent as stipulated, described as unexpended grants for specified projects. Such grants are accounted for as follows: (i) Grants received in advance of project expenditure Grants received in advance of expenditure are deferred, shown in the statement of financial position as ‘Unexpended grants for specified projects.’ When funds are spent in accordance with the donor’s stipulations, the amount is charged off, and included in the relevant expense classification or, if applicable, in property, plant and equipment. An equivalent amount is then transferred from ‘Unexpended grants for specified projects’ to income as ‘projects and special accounts income or, if the expenditure is capital, to ‘capital grants’ on the statement of financial position, which is subsequently accounted for, as described in the Capital grants note. (ii) Project expenditure made in advance of receipt of grants pledged Where projects are funded by donors on a reimbursement basis, the amounts spent are set up as receivable from the donor, and are also reflected in the administration and other operating expenses note as ‘special projects expenses’ or, if applicable, on the statement of financial position as property, plant and equipment, with an equivalent sum reflected in income as ‘Special projects income’ or, if the expenditure is capital, on the statement of financial position as ‘Capital grants’. (p) Endowment Fund The University receives monies for the payment of scholarships. Monies received for the purpose of scholarship are placed on investment with the intention of earning interest to the increase scholarship payments. Monies received for the purpose are governed by trust deeds, which outline the purpose of the monies being granted. The income statement is credited once the scholarship is applied to a student. University of Technology, Jamaica 130
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