GST receivable is an asset. But how does a firm have *control* over the GST receivable account?

future firm
Dactylonomy asked:

An asset is a resource controlled by an entity from which future economic benefits are expected. How is it controlled by an entity when it is essentially the government’s?

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2 Responses to 'GST receivable is an asset. But how does a firm have *control* over the GST receivable account?'

  1. miss schlonky - October 6th, 2009 at 12:03 am

    It’s not an asset. Who told you that? GST collected/receivable is a liability, not a balance sheet asset account. The only assets are the short term equivalent portions of cash in the bank and creditors to the liability of GST collected. GST paid is a contra liability, not an asset either.

  2. hubertxiv - October 7th, 2009 at 7:44 am

    If you are preparing a Balance Sheet at year end, the amount of GST on ‘creditors’ is perhaps shown as an asset (or at least as a credit) and the amount payable on Debtors is shown as a liability. I believe it is preferable to show the actual net amount in the accounts.

    If you are working on a ‘credit’ basis then I believe that a net GST should or could be shown as a net figure. On a ‘cash basis’ of course, the GST would not feature in a Balance Sheet


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