Wiley International Trends in Financial Reporting under IFRS: Including Comparisons with US GAAP, Chinese GAAP, and Indian GAAP

CHAPTER 10

Agriculture (IAS 41)

1. OBJECTIVE

1.1 This Standard prescribes the accounting treatment and disclosures in the financial statements of operations relating to agricultural activity.

1.2 The Standard does not apply to land related to agricultural activity (covered by International Accounting Standard [IAS] 16, Property, Plant, and Equipment, and IAS 40, Investment Property) and to intangible assets that are related to agricultural activity (covered by IAS 38, Intangible Assets).

2. SYNOPSIS OF THE STANDARD

This Standard that applies to biological assets, agricultural produce at the point of harvest, and government grants received for agricultural activity.

2.1. The key terms as defined in this Standard are

2.1.1 A biological asset is a living plant or animal.

2.1.2 Agricultural produce is the product obtained on harvesting the biological assets.

2.1.3 Agricultural activity is the process of managing the biological transformation and harvesting of biological assets, either for sale or for converting them into agricultural produce or additional biological assets.

Government grants are as defined in IAS 20, Accounting for Government Grants and Disclosure of Government Assistance.

2.2 This Standard is applicable only to the agriculture produce that is the entity’s harvested product at the point of harvest; it is not applicable to the produce after harvest.

2.2.1 The items that are harvested become inventory, and the provisions of IAS 2, Inventories, or other related standard, ...