E. Biological Assets

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BIOLOGICAL ASSETS

DEFINITION a. INITIAL, FV – COST TO SELL


- BIOLOGICAL ASSETS, non-current assets refer b. SUBSEQUENT, LCNRV
to living animals or living plants GAIN OR LOSS
- AGRICULTURAL PRODUCE, harvested product of - Recognized on initial recognition and any
biological assets subsequent changes
- HARVEST, detachment of produce from - Should be included in profit or loss
biological asset/ cessation of biological asset - Disclosure of gain/loss on initial recognition
life’s processes only
- AGRICULTURAL ACTIVITY, management by an
entity of the biological transformation and BIOLOGICAL ASSETS ATTACHED TO LAND
harvest of biological assets for sale/ for - FV of land – FV of Combined Assets = FV of
conversion into agricultural produce/ into Biological Assets
additional biological assets
o Capability to change GOVERNMENT GRANT
o Management of change 1. UNCONDITIONAL
o Measurement of change a. Measured at FV – Cost to Sell
- BIOLOGICAL TRANSFORMATION i. Recognized as income when
o Growth – increase in quantity/ receivable
improvement in quality b. Measured at Cost – A/Dep’n or
o Degeneration – decrease in quantity/ Impairment Loss
deterioration in quality i. PAS 20
o Procreation – additional living thing 2. CONDITIONAL
o Production of agricultural produce a. Measured at FV – Cost to Sell
- FAIR VALUE, price that would be received to sell i. Recognized as income when
an asset/ paid to transfer a liability in an orderly conditions are met
transaction between market participants at the b. Measured at Cost – A/Dep’n or
measurement date Impairment Loss
o LEVEL 1 INPUTS – quoted prices for i. PAS 20
identical assets in an active market
o LEVEL 2 INPUTS – quoted price for DISCLOSURE
similar assets in an active market and - PRICE CHANGE
quoted price for similar/ identical FV at year-end xx
assets in an inactive market Less: Acquisition Cost xx
o LEVEL 3 INPUTS – developed by an Price change xx
entity
- PHYSICAL CHANGE
FV at year-end (present age) xx
RECOGNITION
Less: FV at year-end (Previous age) xx
1. the entity controls the asset as a result of past
Physical change xx
events
2. it is probable that future economic benefits will
- TOTAL CHANGE IN FV
flow
Price change xx
3. the FV or cost of the asset can be measured
Add: Physical change xx
reliably
Total change in FV xx
MEASUREMENT
BIOLOGICAL ASSETN

- Initially, FV = Cost – A/Dep’n or Impairment


Loss
a. INITIAL, FV – COST TO SELL
b. SUBSEQUENT, FV – COST TO SELL
2. AGRICULTURAL PRODUCE

Prepared by: Jeanette Lampitoc

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