Current and capital grants

In relation to the subsidies received, a distinction must be made between capital and current subsidies.

• Capital grants are those whose primary purpose is to promote the installation or realization of investments in fixed assets (land, buildings, machinery, installations, etc.) and are recorded as income to the same extent as the fixed assets in which they have been materialized are depreciated.

  However, in those cases where the assets are not subject to amortization, the subsidy will be applied as full income for the year in which the sale or write-off of the asset financed with said subsidy occurs, applying the 30% reduction for returns obtained in a notoriously irregular manner over time.

• Current subsidies which are those normally granted to guarantee a minimum profitability or compensate for losses incurred in the activity, are computed in their entirety as another income in the period in which the granting of the subsidy is firmly recognized and quantified, regardless of the moment in which it is received and unless the taxpayer has opted for the collection and payment criterion, in which case they will be computed in the period in which they are collected.

• Grants awarded to finance specific expenses : They are recorded as income in the same year in which the expenses they are financing are accrued.

  See in this regard the recording and valuation standard 18 of the General Accounting Plan.