Recognition of assets requires which condition?

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Recognition of assets rests on two essential conditions: the asset is expected to bring probable future economic benefits to the entity, and its cost or value can be measured reliably. When both are satisfied, the asset is recognized in the financial statements even if cash has not yet changed hands—for example, it can be acquired on credit or through other non-cash arrangements. This is why the statement that recognition occurs when probable future benefits flow and the asset’s cost can be measured reliably is the best description.

Cash payment isn’t a requirement for recognition, so waiting for cash to be paid isn’t correct. Intangible assets do require recognition if they meet the criteria (identifiability, control, probable benefits, and measurable cost), so saying recognition isn’t required for them is not accurate. And while fair value may be used in some measurement contexts, recognition itself is not limited to fair value alone; initial recognition is typically at cost, with possible subsequent measurement adjustments in certain cases.