Good Afternoon - I thought you would be interested in what FASB is undertaking regarding accounting for government grants (see below).  NRECA is filing comments to stress that below-market loans from RUS are not government grants.  Please call Russ Wasson if you have any questions.

NRECA Files Comments on FASB Research Project Regarding Accounting for Government Grants
February 14, 2022

On January 31, NRECA filed a comment letter with the Financial Accounting Standards Board (FASB) on their research project regarding accounting for government grants.  There is no established guidance in the US on this issue but it is important for NRECA's members (for both electric and broadband).  The FASB is undertaking this research project to study accounting for government grants and it may become an item on a future FASB technical agenda which could result in a new accounting standard that electric cooperatives would have to adopt.  While we generally agree with existing International Standards on this issue, we do not agree that a below-market loan is a government grant.  Such a finding by the FASB could result in considerable work for RUS borrowers and introduce volatility to electric cooperative financial results.

If you have any questions, please contact Russ Wasson via email: russell.wasson@nreca.coop<mailto:russell.wasson@nreca.coop> or via phone at (703) 402-2510.

Michelle Hershel
Director of Regulatory Affairs
Florida Electric Cooperatives Assoc.
2916 Apalachee Parkway
Tallahassee, FL  32301
Cell:  (850) 510-1693
(850)877-6166, ext. 3

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