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[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section bb_built=”1″ fullwidth=”off” specialty=”off” transparent_background=”off” allow_player_pause=”off” inner_shadow=”off” parallax=”off” parallax_method=”off” padding_mobile=”off” make_fullwidth=”off” use_custom_width=”off” width_unit=”on” make_equal=”off” use_custom_gutter=”off” gutter_width=”3″ custom_padding_tablet=”50px|0|50px|0″ custom_padding_last_edited=”on|desktop” prev_background_color=”#ffffff” next_background_color=”#000000″][et_pb_row background_position=”top_left” background_repeat=”repeat” background_size=”initial”][et_pb_column type=”4_4″][et_pb_toggle admin_label=”Index” _builder_version=”3.0.106″ title=”Index” open=”off”]Contents
34.2 Agriculture – recognition and measurement.
34.2.1 Extract from FRS102: Section 34.2-.34.3B.
34.2.2.1 The meaning of biological assets and examples.
34.2.2.1.1 Agricultural activity defined.
34.2.2.1.1.1 Requirements for biological transformation.
34.2.2.1.1.2 Requirements for biological transformation to be managed.
34.2.2.1.2 Biological asset defined.
34.2.2.2 Recognition criteria.
34.2.2.3 Accounting for agricultural produce within the scope of Section 34.
34.2.2.4 Items excluded from the definition of agriculture.
34.2.2.5 Accounting policy choices:
34.2.2.5.3 Accounting policy choice by class.
34.2.2.6 Accounting for agricultural produce after point of harvest.
34.3 Measurement – fair value model.
34.3.1 Extract from FRS102: Section 34.4-.34.6A.
34.3.2.1 Initial and subsequent recognition.
34.3.2.2. Fair value hierarchy model.
34.3.2.2.1 Active market defined.
34.3.2.2.1.1. What market to use where there is more than one market and markets in other locations.
34.3.2.2.1.1.1 More than one market to sell the produce.
34.3.2.2.1.1.2 Market in different locations.
34.3.2.2.1.1.3 Use of cash flow model to determine fair value.
34.3.2.3 Application of the fair value model.
34.3.2.4 Fair values cannot be reliably measured.
34.5 Disclosures – fair value model.
34.5.1 Extract from FRS102: Section 34.7-34.7B.
34.5.2.2.1 Extract from accounting policies note for forestry.
34.5.2.2.2 Extract from accounting policies note for livestock (Extracted from Appendix to IAS 41).
34.5.2.3 Critical accounting estimates and judgments disclosure.
34.5.2.4 Notes to financial statements.
34.7 Measurement – cost model.
34.7.1 Extract from FRS102: Section 34.8-34.9.
34.7.2.1 Initial and subsequent measurement/
34.7.2.2 Choices when applying the cost model to agricultural produce.
34.8 Disclosures – cost model.
34.8.1 Extract from FRS102: Section 34.10-34.9.
34.8.2.3 Notes to the financial statements.
34.9.1 Extract from FRS102: Section 34.11-.34.11C.
34.10 Service Concession Arrangements.
34.10.1 Extract from FRS102: Section 34.12-.34.16A.
34.10.2.2 Service conditions arrangements defined.
34.10.2.2.1 Conditions that must apply.
34.11.1 Extract from FRS102: Section 34.17-.34.33.
34.11.2.2 Financial institution defined.
34.12 Retirement Benefit Plans: Financial Statements.
34.12.1 Extract from FRS102: Section 34.34-.34.48.
34.12.2.2 Full set of financial statements.
34.13.1 Extract from FRS102: Section 34.49-.34.56.
34.13.2.1 Heritage asset – defined.
34.13.2.2 Recognition and measurement.
34.13.2.3 What about old heritage assets where there are no records to determine cost.
34.13.2.4 Where should heritage assets be disclosed on the balance sheet.
34.13.2.5.1 Possible reasons for impairment.
34.13.2.6 Useful life and residual value.
34.13.2.7 Heritage assets received free of charge.
34.13.2.8.2 Illustration of some of the disclosure requirements for heritage assets.
34.14.1 Extract from FRS102: Section 34.57-.34.63 and Appendix A to Section 34.
34.15 Public benefit entities: Incoming Resources from Non-Exchange Transactions.
34.15.1 Extract from FRS102: Section PBE34.64-.PBE34.74 and Appendix B to Section 34.
34.15.2.1 Public benefit entity defined.
34.15.2.1.1 Requirement to disclose that an entity is a public benefit entity.
34.15.2.2 Special rules for public benefit entities.
34.15.2.2.1 Assets held for provision of social benefits.
34.15.2.2.2 Income resources from non-exchange transactions.
34.15.2.2.2.2 Accounting for non-exchange accounting.
34.15.2.2.2.2.1 Recognition for goods and measurement for goods.
34.15.2.2.2.2.1.1 Performance related conditions defined.
34.15.2.2.2.2.1.2 Conditions that are not performance related.
34.15.2.2.2.2.1.3 Examples of non-exchange resource transactions received in the form of goods.
34.15.2.2.2.2.2 Non-exchange resources received in the form of services/facilities.
34.15.2.2.2.2.2.2 Recognition and measurement.
34.15.2.2.2.2.2.2.1 Examples of non-exchange Transactions where services/facilities provided.
34.15.2.2.3 Public benefit entity combinations.
34.15.2.2.3.1.1 Business combinations defined.
34.15.2.2.3.2 Accounting Requirements.
34.15.2.2.3.2.1 Gift of a business for nil or nominal consideration.
34.15.2.2.3.2.1.1 Example of business combinations which is a gift that is not a merger.
34.15.2.2.3.2.1.2 Disclosures.
34.15.2.2.3.2.2 Examples illustrating merger accounting.
34.15.2.2.3.2.3 Meets the definition of a true acquisition and the purchase method applies.
34.15.2.2.3.2.3.1 Example business combination: Not a merger or gift – Purchase accounting method.
34.15.2.2.4 Public benefit concessionary loans.
34.15.2.2.4.2 Public benefit entity loan defined.
34.15.2.2.4.3 Accounting treatment of public benefit concessionary loans choices. 4
34.15.2.2.4.5 Examples of concessionary loans.
34.15.2.2.5 Government grants and accounting requirements.
34.15.2.2.5.1.1 Grants of all natures – Performance model.
34.15.2.2.5.1.2 Accrual model FRS 102 only.
34.15.2.2.5.2 Example of government grant accounting of PBE’S.
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34.8 Disclosures – cost model
34.8.1 Extract from FRS102: Section 34.10-34.9
34.10 An entity shall disclose the following for each class of biological asset measured using the cost model:
(a) a description of each class of biological asset;
(c) the depreciation method used;
(d) the useful lives or the depreciation rates used; and
(e) a reconciliation of changes in the carrying amount of each class of biological asset between the beginning and the end of the current period. The reconciliation shall include:
(i) increases resulting from purchases;
(ii) decreases attributable to sales;
(iii) decreases resulting from harvest;
(iv) increases resulting from business combinations;
(v) impairment losses recognised or reversed in profit or loss in accordance with Section 27 Impairment of Assets; and
(vi) other changes.
This reconciliation need not be presented for prior periods
34.10A An entity shall disclose, for any agricultural produce measured at fair value less costs to sell, the methods and significant assumptions applied in determining the fair value at the point of harvest of each class of agricultural produce.
34.8.2 OmniPro comment
34.8.2.1 Overview
See illustration of the above disclosures required by Section 34.10 to 34.10A of FRS 102 below:
34.8.2.2 Accounting policies
Example 6: Extract from accounting policies notes for livestock/biological assets carried at cost
Biological assets – Forestry (Cost)
The acquisition of land for forest projects is originally recorded at cost in accordance with Section 17 of FRS 102. Biological assets are measured at the lower of cost and estimated selling price less costs to complete and sell. This represents the cost less any accumulated depletion and any accumulated impairment losses.
The company capatilises the costs associated with establishing and maintain its forest plantations. Direct costs are capatilised on the basis of specific operations carried out. Indirect costs are capatilised by reference to the proportion of the direct costs capatalised for which the imdividual management team has responsibilities.
Depletion represents the costs of forests clearfelled during the year, calculated as the proportion that the area harvested bears to the total area of similar forests. The depletion amount is charged to the profit and loss account and is based on cost which includes establishing costs, and allocation of maintenance costs capitalised since the date.
Extract from accounting policies notes for livestock
Biological assets – Livestock
Livestock are measured at the lower of cost and net realisable value. The purchase price of livestock bought in is measured at the purchase price plus directly attributable purchase costs. Own reared stock is measured at cost based on the selling price of the livestock less an appropriate margin based on industry norms to bring the value back to the estimated cost price.
34.8.2.3 Notes to the financial statements
Example 7: Extract from the notes to the financial statements disclosing biological assets held at cost:
| Analysis of Biological Assets by Class | 2015 | 2015 | 2015 | 2015 | 2014 | 2014 | 2014 | 2014 |
| CU | CU | CU | CU | CU | CU | CU | CU | |
| Mature Cattle | Immature Cattle | Wheat | Forests | Mature Cattle | Immature Cattle | Wheat | Forests | |
| Opening Balance |
100,000 |
50,000 | 40,000 | 30,000 | 100,000 | 50,000 | 40,000 | 40,000 |
|
Purchases |
20,000 | 2,000 | 10,000 | 10,000 | 20,000 | 2,000 | 10,000 |
10,000 |
| Sales |
-40,000 |
-33,000 | – | – | -40,000 | -33,000 | – | – |
|
Harvest |
– |
– |
-30,000 |
-30,000 |
– |
– |
-30,000 |
-30,000 |
| Acquired through Business Combinations |
30,000 |
– |
– |
– |
30,000 |
– |
– |
– |
| Newborns |
– |
40,000 |
– |
– |
– |
60,000 |
– |
– |
|
Transfer from Immature to Mature |
19,000 |
-19,000 |
– |
– |
19,000 |
-19,000 |
– |
– |
| Other Changes | – | – | – | – | – | – | – | – |
| Gains/(loss) arising from Fair Value less Costs to Sell | 25,000 | -10,000 | 10,000 | 10,000 | 25,000 | -10,000 | 10,000 | 10,000 |
| Closing Balance | 154,000 | 30,000 | 30,000 | 20,000 | 154,000 | 50,000 | 30,000 | 30,000 |
Biological assets – Standing forest plantations
| Total | |
| CU | |
| Costs | |
| At beginning of year | 891,013 |
| Additions in year | 1,586,437 |
| Depletions | (500,000) |
| Transfer to property plant and equipment | (100,000) |
| Transfer to inventory | (XXXX) |
| Depletion in year | (93,359) |
| At end of year | 2,984,091 |
| Accumulated impairment | |
| At beginning of year | – |
| Movement in year | 149,999 |
| At end of year | 788,067 |
| Net book value | |
| At 31 December 2015 | 2,196,024 |
| At 31 December 2014 | 85,885 |
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Examples
Example 2: Application of the fair value model com.
Example 3: Application of the fair value model – livestock.
Example 4: Biological Assets held at fair value.
Example 5: Extract from notes to the financial statements for biological assets held at fair value.
Example 6: Extract from accounting policies notes for livestock/biological assets carried at cost.
Example 14: Donated goods or services – fixed assets.
Example 15: Donated goods or services – donated goods held for resale – impractical to measure.
Example 16: Donated goods or services – donated goods held for resale – practical to measure.
Example 18: Donated goods or services – donated services.
Example 19: Business Combinations: Gifts of business etc.
Example 20: Business Combinations: Mergers.
Example 21: Concessionary loans – option not to discount.
Example 22: Concessionary loans – option to discount.
Example 24: Accruals model (applicable for FRS 102 only and not Charities SORP) – capital grant.
Example 25: Accruals model (applicable for FRS 102 only and not Charities SORP) – revenue grant.
Example 26: Accruals model (applicable for FRS 102 only and not Charities SORP) – revenue grant.
Example 27: Performance model (applicable for FRS 102 and Charities SORP) – revenue grant.
Example 28: Performance model – Revenue Grant.
Example 29: Capital grants (FRS 102 and FRS 102 SORP – performance model).
Example 30: Grants and performance conditions.
Example 31: Grants and performance conditions.
Example 32: Grants and performance conditions.
Example 33: Grants and performance conditions.
Example 34: Grants and performance conditions.
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