Accounting of Long-Term Biological Assets
Accounting and Finance,
fair value, valuation of long-term biological assets, increases and decreases in value of assets, investment activity fund sources
The article is devoted to generalization of experience in valuation of long-term biological assets of plant-growing and animal-breeding, and preparation of suggestions concerning improvement of accounting in this field. Recommendations concerning accounting of such assets are given based on the study of accounting practice at specific agricultural company during long period of time. Authors believe that fair value is applicable only if price level for agricultural products is fixed by the government as it is the case in a number of countries (USA, China, Germany and some other); increases in the value of long-term biological assets according to Accounting Provision (Standard)30 'Biological Assets' are unreasonable; the long-term biological assets of plant-growing are to be valued historically, and their value is to be charged with amortization according to effective regulations; the long-term biological assets of animal-breeding are to be valued historically and when they are retired, difference is to be calculated between initial value of objects and earnings from their disposal with positive result to be included in production costs and negative â€“ to be attributed to incomes from investment activities.