Paul Sutcliffe Quotes on Economics (2 Quotes)

We should be reporting the results of economic phenomena, like the imposition of taxes, in the period in which the taxing event occurs and the government gains the right to resources. This will often be the same period in which the cash flows, but need not be.

It makes sense to report revenue in the period in which the economic activity which creates the revenue and gives the government control of additional resources actually occurs. This is when the government is better off. This may not be the same as the period in which, for example, the cash is collected. For purely administrative reasons, in many jurisdictions cash may be collected before or after the economic event the taxing event occurs.