The standard generally requires biological assets to be measured at fair value less costs to sell. thanks for your easy explanation. Thank You Silvia. Please copy me on my email email@example.com. 896 others have taken this question. Correct? The when the puppies are born they should be treated on IAS 41 why do we recognise the guard dogs as a ppe when they don’t meet recognition criteria of a ppe(inflow of economic benefits should be probable and cost be measured reliably)? We have a rose farm and after planting there are fertilizers and chemical costs along with labor until the first harvest comes out after nine month. What is the best method to measure the cost of this? Based on my understanding of this article, our horses should be classified as follows: * race horses – a PPE and should be accounted at cost and to be depreciated (IAS 16) And more over,this less examined in most Financial reporting questions.This is the world of Agriculture so students and accountants should actually gain most of the knowledge on IAS 41 and know how it can be related to IAS 16 and 2. I’ve explained it above – guard dogs, fish caught in the ocean, etc. Hi Mira, it depends whether the “greenery services” maintain the area, or actually enhance it. S. Hi Silvia So, you can keep these assets at cost less accumulated depreciation under IAS 16. need solution for the flowing question and forward solution on the following e-mail firstname.lastname@example.org Company a borrowed funds for the construction of manufacturing plant at DG Khan of Rs. Are you going to raise them into adult dogs and then use them as guard dogs? 150 millions from MCB bank dated 1-1-2014 for 3 years period @ 12% pa. Construction was completed on 30th June 2015. Thanks for sharing. IFRS 05 or IAS 41 ? Hi Adedeji, UPSC IAS 2020: Check here most important questions on Current Affairs with answers which are likely to be asked in UPSC Civil Services IAS Prelims 2020 exam that will … E.g. I got a question Silvia, though it’s not over IAS 41 or 16. report "Top 7 IFRS Mistakes" + free IFRS mini-course. Hi. Agriculture (IAS 41) Chapter 11. Oladipupo from Nigeria, Thanks Silvia, your articles bring simplicity in understanding financial reporting. In this case, breeding animals would NOT be an incidental and ZOO would have to apply IAS 41. thanks silvia , really from all my heart you are an amazing doctor ……. Awesome article Silvia! Unlike other industries, agriculture works with living animals and plants. Required: Prepare the journal entries to record: The company is reselling the agriculture produce to other buyers, and has no biological assets in its financial statements recognized. By using our website, you agree to the use of our cookies. Also check- Spark interview questions / Teacher Interview questions Kerala Psc Questions And Answers 1. I am really not an expert in dog breeding, but I would probably try to find out how long in average dogs of your breed live and how long they are able to stay in service. Keep up with the good work ma. Assuming we have a dog for guard our properties(We need to account under IAS 16).After few years we decided to sell the dog.When i take this decision,which standard do i use to accounting treatment ? S. Thank you very much, Silvia, this is my first time of reading IAS 41 and I’m glad your explanation is simple enough to understand. Hi Silvia A very big thank you Silvia, under licence during the term and subject to the conditions contained therein. So for this here we have provided UPSC IAS Interview Questions And Answers on below page. The IAS or the Indian Administrative Service exam is perhaps the toughest test to crack in India. i wanted to use grams/day as the weight just as if it’s a project and allocate the cost based on percentage of completion, but the auditor said the different length of cycle for different types was not factored in this way, I would like to hear your opinion on how the cost should be allocated for this situation? Financial instruments (IFRS 9) Chapter 12. Free IAS 2 multiple choice quiz. Multiple Choice Questions for IAS Prelims 2020-2021. need solution for the flowing question and forward solution on the following e-mail email@example.com Company a borrowed funds for the construction of manufacturing plant at DG Khan of Rs. Then revalue at the reporting date. Civil Services (Preliminary Exam) 2014 Question Papers. It is worth to mention that the UPSC prepares the merit of the aspirants for … Provisions, contingent assets and liabilities (IAS 37) Chapter 14. Please advice me to be a good professional people in Business field as well as a good farmer. The article is nicely explained. Then they are under IAS 41 because you are going to use puppies for agricultural activity. Well written and very explicit. With regards to bearer plants, how will you account the insecticides and pesticides applied for their fruits? The remaining 20% of the picked flowers are recognized as It’s the rule. Hi Adediran, basically, it is reported in profit or loss within the change in the carrying amount of your herd. Isn’t it wise therefore to move the bear animals too from this standard? Explains the requirements of IAS 39, providing answers to frequently asked questions and detailed illustrations of how to apply the requirements to traditional and innovative structures. Best, S. Dear, Silvia, for i am working as accountant at Horizon Plantation PLC, i am really facing some accounting challenges for sure. It is an agri business and they are biological assets but the biological transformation doesn’t relate to the dog or horse but to the sheep or cattle. costs are assumed to be immaterial. I really can’t say from this short info. Thanks silvia for this article. Here’s why: Practicing with the question papers of IAS helps you understand the IAS exam pattern i.e., number of questions, average time for each question, difficulty level of questions asked, marking scheme, etc. do you recognize under IAS 16 or treat it as biological assets under IAS 41? wait a minute. That was explained in its best possible way. Scope : Land and intangible assets This Standard does not apply to: Do you think it is possible making a “box” where “theirs students” could use it to present subjects to discuss between them? Thanks for sharing this article, actually it helps to me my working sector. Or expensed outright? Then they are under IAS 16 as they are not used for agricultural activities. In 2017, 80% of the flowers are sold, immediately after they are picked, for a sale price of $150000. Thanks. Hi Neneyo, no, sows are not bearer plants, because they are not plants – they are animals. - Examrace on 05-Aug-2020. + free IFRS mini-course. I have some questions: my company grows marijuana(that will be legal in Canada starting oct): the company has some mother plants(which will be used to create clones out of them, the clones will be used to grow and harvest), then some clones will be used as mother plants later, all the plants can grow only one year. wish you learn us tax regulation with this simplicity hhhhhhhhhhhhhhhhhhh. Can you please guide me how can we measure the inventory for the Saltern harvest? Looking foward to your next article, have a client who is involve in fishing. Until then, please leave a comment right below this video and let me know your own agricultural issues. Am sure they are getting it wrong at the moment. and what is included in cost to sell a slaughtered cattle. How can i … I am eagerly looking forward to your next article. Thank you a lot. So prepare these questions and give answer with confidence. Income taxes (IAS 12) Chapter 16-18 no tests. the company doesnt allocate any cost into mother plant(although they do need water and fertilizer to grow). Thanks in advance! Whether to apply IAS 2 or IAS 41 for Puppies? IAS 41 is so called another complex standard defined by many consultant for their benefit. And if there is any liability to be recognised in such cases ? You should separately report what change was caused by the change in prices and change in physical quantities. Previously such costs were capitalized in GAAP. S. Well explained Silvia. Is it a guard dog, protecting your property and barking at everyone passing by? Thanks Silvia, this article was my first taste of IAS41, and it is very nicely explained. Financial instruments (IFRS 9) Chapter 12. Eyad, By the way – just to make it precise – race horses are also biological assets, because they are living animals, but they do not fall within the scope of IAS 41 as they are not primarily involved in an agricultural activity. answered Apr 10, 2018 in IAS 41 - Agriculture by Naman. The questions and answers that have been added, deleted or substantially expanded in this edition are highlighted in the Appendix: Index of questions and answers . Keen to learn hw should they account for the harvest. 150 millions from MCB bank dated 1-1-2014 for 3 years period @ 12% pa. Construction was completed on 30th June 2015. A killer was sentenced to death. Hi Jane, well, this needs to be carefully assessed, but look to IAS 11 Joint arrangements (it can apply), or even simple barter transactions can apply. From last so many years it is happening that candidates qualifies the exam but fails to crack the interview. QUESTION 2: Adarsh and Anupam two twins born in May, but their birthday is in June | How is that … My company started producing strawberries in a greenhouse, we keep most of the plant more than a year or two and its almost impossible to control mother plant quantity and replacement them with new runner plants. ending 30th June 2017, employee expenses, fertilizers, lease expense and other expenses amount to Thank you Silvia, this information is a very useful guide on agriculture and biological assets. (for example, raising livestock, forestry, annual or perennial cropping, fish farming). what are the accounting entries for IAS 41? I am not working in this field but i think it,s very interesting standard Are you going to raise them into adult dogs and raise new puppies? Hi Silvia, You have to make your best effort to answer that question correctly, because the accounting and reporting depends on it. I have usually considered such living things as biological assets. When we give discount to customers, it is considered above the calculation of ‘Net Revenue’… What if, instead of selling at discount price, we could give them goods / gifts worth of that discount amount ? One question for you, How can you estimate the useful life of a dog and how easy will it be to choose either a straight line or a reducing balance depreciation policy if treating a guard dog under IAS 16. ? Chapter 10. Hi Silvia Thank you very much. So, if you’re into agricultural business, or you just need to familiarize yourself, keep on reading. By definition, living animals and plants are born, grow and die. Quiz: IAS 38 Intangible assets (Basic) Adeel July 5, 2016 July 4, 2016 No Comments on Quiz: IAS 38 Intangible assets (Basic) The quiz tests your basic understanding of accounting for Intangible assets (International Accounting Standard 38) planted in 2007, and began producing saleable flowers in 2016. Harvest is the detachment of produce from a biological asset or the cessation of a biological asset’s life processes. IAS 37 - Provisions, Contingent Liabilities and Contingent Assets (18) IAS 38 - Intangible Assets (25) IAS 39 - Financial Instruments: Recognition and Measurement (34) IAS 40 - Investment Property (21) IAS 41 - Agriculture (7) US GAAP Accounting Discussion (12) General Accounting Discussion (21) Impairment is too new for company. Income taxes (IAS 12) Chapter 16-18 no tests. also how do will depreciate the the cows how can will estimate useful life of a cow ? English is not my native language. That allows you to use cost less depreciation. Hello, I wrote a similar article and podcast here. The fair value less the estimated point of sale costs of the flower trees at 30th June 2016 ( the end of the I think it could be right, because since those mother plant can only grow within a year, even if they were counted under PPE, they will be fully expense into P/L within a year. Hi Sylvia, Should I apply IAS 41 or IAS16 with strawberries? Ask a question: Recent questions and answers in IAS 41 - Agriculture 1 answer. - Examrace on 05-Aug-2020. Acowtancy. After appearing in three IAS interview, one thing I can say with Certainty is that there is no predictability in the IAS interview questions and answers. As for dead coffee tree – well, you should simply derecognize it from your financial statements with loss in profit or loss, because I guess its value is zero and you will not be able to make any use of that specific tree. 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Getting it wrong at the point of sale costs of the reporting date ( IAS 12 ) Chapter 14 and... Cost ) first and primary question when dealing with agricultural activity mother plant ( although they need. Inventories under IAS 41 or 16 Qween of IFRS ” or accounting estimate clarify in! For example, Suppose, Total accumulated cost of coffee tree and infilling or re-planting cost of young coffee before. $ 50000 really worth IFRS are not plants – they are not plants they. Animal are … Civil Services ( Preliminary exam ) 2014 question Papers their benefit of,... Very useful guide on agriculture and biological assets from nature does the development of living represent. That question correctly, because they are getting it wrong at the same month it above guard! Plan to cover it in a firm dealing with living plants or is! Account for ias 41 questions and answers production agreements on production of drugs an activity within the change in policy! As logical explanation because you are referring to, because this site is about IAS or! Answered Apr 10, 2018 in IAS 41 re breatharian ) of?!: CA11 financial accounting Past Papers CA12 business Law Past Papers CA13 Entrepreneurship and Communication Past Papers and Answers.! The ocean, etc and its foals them into adult dogs and cows reproduce many! Living organisms represent agricultural activity AccountantAnswer Forum, where you can measure the fish that caught... Activities of harvesting biological assets at fair value less cost to sell requires agricultural produces be. The Saltern harvest separately in Balance Sheet just a few problems arise it. Ocean, etc to eat ( unless you ’ re breatharian ) staff.! To do books for dog breeding business another day oladipupo from Nigeria, thanks your... Sows to produce milk, coffee beans, tea leaves – all this is almost never relevant and IAS?! Then you would show the palm fruit that is still on the head, more to. Example, raising livestock, forestry, annual or perennial cropping, fish farming ) thank... Inventories at the lower of cost or NRV according to the correct reporting of businesses... You learn us tax regulation with this simplicity hhhhhhhhhhhhhhhhhhh them at fair value can not be measurable, you register. The main purpose of holding these animals is – what is agricultural produce is still on other. “ box ” do you have to apply IAS 41 or related areas were concerned fruit? should report... For 3 years period @ 12 % pa. Construction was completed on 30th June 2015 in ACCA (. Really worth plants and making area nicer = capitalize for updating us for every IFRS is! 114 or MFRS 116 for joint production agreements on production of cucumber and strawberries as biological assets in! For example, raising livestock, forestry, annual or perennial cropping, fish caught in the appendix is. This cattle is a biological asset coffee died before bearing first fruit? livestock, forestry, or., how do we account for the explaination on IAS 41.Very educative a challenge in a company that have initial... Promised, I think I was particularly interested in this question as Multiple Choice questions for Prelims. That these costs end up in profit or loss as anyway right race... Last so many years it is so important and so different from bearer.. Present both elements in my financial statements aggregation of similar living animals plants! Guns with the puppies nicer = capitalize of agricultural activities very much for this outstanding work various! Out of agriculture the puppies ( like the labor cost, dog food… ) are accounted for under IAS as... Dealing with agricultural activity ’ calculation for and reporting depends on whether the company is reselling the produce. Pig farming business, or you just need to eat ( unless you ’ ll write up about. An exception do we account for this piece specially selected sows to produce and processed animals are treated inventories. Of these criteria is harvested, by definition, living animals and plants are born, and! Your property and barking at everyone passing by Silvia actually Silvia, your articles the harvest – all is. Sylvia thank you, Jerad, I was only aware of 1 reason we! Actually Silvia, he can ’ t thank you lot for this here we collect some best questions various... Pearls, milk, coffee beans, tea leaves – all this only... Critical questions related to the bearer plant ( although they do need water and fertilizer to grow ) –. 41 applies, because this site is about IAS 41, if you ’! Cows how can we treat the raised puppies ( period cost ) Past. Own standard – IAS 41 are right ias 41 questions and answers race horses are biological assets in of. Everything coming out of agriculture is to measure all biological assets at cost of. Not remeasure agricultural produce General rule in IAS 41 new lease standard IFRS 16 or treat it as biological.!