IAS 20 permits the reporting of government grant either on the deferral method or on the offset method. As accountant of a limited company which of the following reasons will prompt you to opt for the deferral method rather than the offset method?

(a) Under the offset method the asset will not be reported at its real cost

(b) Under the offset method the company’s profit will be understated

(c) On the offset method the depreciation expense is netted against income from grant

(d) The deferral method would identify the liability that needs to be refunded if the terms of the grant are not complied with

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wc & d x b, c & d y All four za & c