Abstract
This study aimed to analyze the context of fair value measurements of biological assets under the accounting professionals’ perspective from the Brazilian sugarcane sector. Secondly, verifying the existence of clusters among the participants of the study and also checking whether or not there is a relationship between the accounting professional’s profile and his perception of the impacts on the measurement of biological assets. A field study was carried out utilizing a survey with qualitative and quantitative approach, involving cluster analysis, content analysis and Fisher’s exact test, considering a population sample of 32 accounting professionals from the sector. From the cluster analysis it was possible to identify the existence of three professional groups with similar characteristics of profile and perception of impacts brought by IAS nº 41. The quantitative analysis shows that the professionals that work in plants located in states with high or low concentration of sugarcane productive chain perceive the rule distinctively. The qualitative analysis suggest that there are two views, one against and the other in favor of the rule, showing that there is not a consensus when it comes to enforcing the rule in the sector. As few studies attempt to analyze the impact, advantages and disadvantages from the accountant’s point of view, this study contributes to fill out this gap. This study offers insights to the governing entities on the necessity of a greater practical detailing and problems related to the acceptance of the rule in Brazil.
Highlights
The international standardization of accounting rules has been discussed since 1973 and became more intense with the establishment of the International Accounting Standards Board (IASB) in 2001 (NIYAMA, 2007)
The adoption of International Financial Reporting Standards (IFRS) with the publishing of the International Accounting Standards (IAS) no 41 – Agriculture, the rural entities have had to meet an accounting demand to measure their biological assets and agricultural products, the fair value, most of the times abandoning the concept of historical cost
The superiority of fair value accounting on the historical cost is due to its capacity to incorporate new market conditions in the accounting numbers, providing more relevant useful information for economical decision making (ARGILÉS; GARCIA-BLANDON; MONLLAU, 2011; ARGILÉS BOSCH; ALIBERCH; BLANDÓN, 2012; ATHANASIOS; STERGIOS; LASKARIDOU, 2010; BARLEV; HADDAD, 2003; BARTH; LANDSMAN; LANG, 2008; DOWLING; GODFREY, 2001; GONÇALVES; LOPES; CRAIG, 2017; LEFTER; ROMAN, 2007; PENG; BEWLEY, 2010)
Summary
The international standardization of accounting rules has been discussed since 1973 and became more intense with the establishment of the International Accounting Standards Board (IASB) in 2001 (NIYAMA, 2007). The adoption process of the International Financial Reporting Standards (IFRS) by several countries in the world is pointed by Daske et al (2008) as a great regulating landmark in the history of accounting, and represents a theoretical landmark in this study. The adoption of IFRS with the publishing of the International Accounting Standards (IAS) no 41 – Agriculture, the rural entities have had to meet an accounting demand to measure their biological assets and agricultural products, the fair value, most of the times abandoning the concept of historical cost. There are several criticisms to fair value because it is an estimate-based measurement, mainly for assets that do not possess an active market and that demand high level of judgement from the accounting professional (BOOTH; WALKER, 2003; COSENZA; LAURENCEL, 2011; ELAD, 2004; ELAD; HERBOHN, 2011; HERBOHN; HERBOHN, 2006; WATTS, 2003)
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