This document provides an overview of IND AS 41 - Agriculture. It discusses the objective, scope, key definitions, recognition, measurement and disclosure requirements of the standard. The standard relates to accounting for agricultural activity, including biological assets and agricultural produce. It requires biological assets and agricultural produce to be measured at fair value less costs to sell, except when fair value cannot be measured reliably. The document provides examples of biological assets and the resulting agricultural produce, and outlines the recognition criteria and disclosures required by the standard.

1. Overview on IND AS 41-Agriculture
By
B. Chaya Deepthi
Intern
M/s SBS and Company LLP
chayadeepthib@sbsandco.com
SBS Hyderabad
01st Sep, 2018
chayadeepthib@sbsandco.com www.sbsandco.com +919573909849

2. 2
Objective
Scope
Key definitions
Recognition
Measurement
Disclosure
Agenda for the session

3. 3
Objective
DisclosuresAccounting
treatment
Objective
Relating to Agricultural activity
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hoto by Unknown Author is licensed under CC
C-ND

4. 4
Includes
• Biological Asset
• Agricultural produce(Not yet harvested)
• Govt. grants on BA
Excludes
• Intangible Assets (AS 26/IND AS 38)
• Land (AS 10/ IND AS 16)
• Plant and machinery (AS 10/ IND AS 16)
• Bearer Plants (AS 10/ IND AS 16)
• Agricultural produce harvested (AS 2/ IND AS 2)
• Govt. grants on above (AS 12/ IND AS 20)
Scope
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5. 5
 Biological Asset: living Plants and animals
 Agricultural activity: Management by an
entity of the biological transformation and
harvest of biological assets for sale or for
conversion into agricultural produce or into
additional agricultural produce.
Definitions (1/4)
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6. 6
 Biological Transformation: comprises the
process of
 Growth- An Increase in Quantity or
improvement in quality of an animal or plant
 Degeneration-Decrease in quantity or
deterioration in quality of an animal or plant
 Production- of agricultural produce
 Procreation-Creation of additional living
animals and plants
Definitions (2/4)

7. 7
 Harvest: detachment of produce from a
biological asset or the cessation of a biological
asset’s life processes.
 Agriculture produce: harvested product of
the entity’s biological asset
Definitions (3/4)

8. 8
 Bearer Plant: may be defined as a living plant
that:
• is used in the production or supply of
agricultural produce
• is expected to bear produce for a period more
than 1 accounting period and
• has a remote likelihood of being sold as
agricultural produce, except for
incidental scrap sales.
Definitions (4/4)
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9. 9
Biological Asset Agricultural Produce Products that are resulted of
processing after harvest
Sheep Wool Carpet
Dairy Cattle Milk Cattle
Sugar Cane Harvested Cane Sugar
Grapevine Picked grapes Wine
Cotton plants Harvested cotton Thread, Clothing
Examples

10. 10
 Entities are required to recognise a biological asset or agricultural produce only when all the
following conditions are satisfied:
 The entity controls the asset as a result of past events
 It is probable that future economic benefits associated with the asset will flow to the entity and
 The fair value or cost of the asset can be measured reliably.
 Initial recognition will occur at the point of purchase or when biological assets are generated from
existing assets such as calves from livestock.
 Agricultural produce that is attached to a biological asset such as wool to sheep and grapes to vine is
not recognised separately until the point of harvest.
Recognition of Assets
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11. 11
 Biological Asset : Fair value – cost to sell
 Agricultural produce : Fair value – cost to sell at
initial recognition but later i.e, after harvest they
are valued as per IND AS 2.
 Biological Asset is valued at fair value less cost
to sell at the end of every financial year. Any
change in the value is recognised in profit and
loss account.
Measurement
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12. 12
Government Grants
Biological Asset
Measured at Cost (fair value
cannot be measured reliably)
Measured at Fair Value –Cost
to sell
Conditional GrantUnconditional Grant
Cost less accumulated
depreciation and any
accumulated
impairment losses.
IND AS 20 is applied
Recognised in P & L a/c when
the grant becomes receivable
Recognised only when
conditions attached to it are
fulfilled

13. 13
 Description of biological assets and activities
 Gains and losses recognised during the period
 Reconciliation of changes in biological assets
 Restricted assets, commitments and risk management strategies
 Additional disclosures when fair value cannot be measured reliably
 Government grants
Disclosure
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B. Chaya Deepthi
Intern
M/s SBS and Company LLP
Chayadeepthib@sbsandco
.com
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