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Paul City Received Payment of Two Grants from the State

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Paul City received payment of two grants from the state during its fiscal year ending September 30, 2016. Grant A can be used to cover any operating expenses incurred during fiscal 2017. Grant B can be used at any time to acquire equipment for the city's fire department. Should the city report these grants as grant revenues or deferred inflows in its government-wide financial statements for fiscal 2016? Paul City received payment of two grants from the state during its fiscal year ending September 30, 2016. Grant A can be used to cover any operating expenses incurred during fiscal 2017. Grant B can be used at any time to acquire equipment for the city's fire department. Should the city report these grants as grant revenues or deferred inflows in its government-wide financial statements for fiscal 2016?

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