Abstract
Activities in the field of agriculture deal with plants and animals constituting biological assets of the sector. From the point of view of accounting and valuation, biological assets is a scarcely investigated topic in Latvia, as well the object of the research only in general terms is reflected in Latvian legislation. That leads to confusion and uncertainty in evaluation and accounting of biological assets in the practical accounting. The subject of the study: evaluation and accounting of biological assets. The aim of the study is to explore and analyse problems of accounting and evaluation of biological assets in Latvia and to propose solutions. One of the research tasks is to explore the current legal base for evaluation and accounting of biological assets provided in the national legislation, to evaluate how it complies with the international accounting standards and to analyse the experience of other countries. The challenging issues of evaluation and accounting of biological assets in Latvia are defined in the research, possible solutions for improving the quality of accounting of biological assets are developed proposing the necessary amendments to the legislation and revisions to the methodological documents. Methods of the research: monographic/descriptive method, document analysis, and graphical analysis.
Highlights
Agriculture is the sector, where accurate and correct counting and valuation of biological assets play a key role in the accounting and annual reporting process
According to the Law on the Annual Financial Statements and Consolidated Financial Statements, biological assets are valued at their acquisition or actual production costs and they are gradually depreciated
It is established that the existing legislation in Latvia regarding the evaluation and accounting of biological assets does not provide sufficient legal provisions, and clarification and comprehensibility of legislative acts
Summary
Agriculture is the sector, where accurate and correct counting and valuation of biological assets play a key role in the accounting and annual reporting process. Novelty of the research: the normative acts on the basic principles of evaluation and accounting of biological assets in the Republic of Latvia have been investigated. In the process of the paper development, research and analysis of the available information was carried out, concluding what are the issues of the evaluation and accounting of biological assets and their possible solutions. The authors of the paper have examined the differences in evaluation and accounting of biological assets in Latvia, Estonia, and Lithuania. Ore in her research has explored theoretical concepts in accordance with the International Accounting Standard (IAS) 41-Agriculture that could be important and may serve as a basis for elaboration of Latvian Accounting Standards (LAS) for “Biological Assets” or “Agriculture”. In 2016, share of agriculture, forestry, and fishing was 3,3% of the gross value added in Lithuania and 2,9% in Estonia
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