Under modified accrual accounting, availability means resources are expected to be collected within the current period or soon after year-end to pay current obligations. Which option correctly states this?

• A. Only if cash is on hand
• B. Only if revenue is unrestricted
• C. During the current fiscal period or soon after year-end to pay current obligations
• D. At the start of the next fiscal year

Answer: (C)

Availability in modified accrual accounting means revenues are recognized only if they can be used to pay current obligations in the near term. In other words, resources must be collectible during the current fiscal period or within a short period after year-end to finance the period’s expenditures. That’s why the statement that aligns with this concept is that revenues are available during the current fiscal period or soon after year-end to pay current obligations. It isn’t about having cash on hand at year-end, nor about unrestricted revenues, and it isn’t about waiting until the next fiscal year to recognize them.