Under the modified accrual basis of accounting:

$1.$

Revenues are recognized when current financial resources become measurable and available to pay current$-$period obligations.

$2.$

Expenditures are recognized as the cost of an asset expires or is used up in providing government services.

$3.$

Expenses are recognized when an obligation occurs for costs incurred in providing services.

$4.$

Revenues are recognized at the time an exchange transaction occurs.