Accounting Standards for Private Enterprises

Discussion Paper, Agriculture

Summary

The Accounting Standards Board (AcSB) has been informed that, as a result of a lack of specific authoritative guidance, there is diversity in accounting by private enterprises for biological assets (i.e., living animals or plants) and agricultural produce (i.e., the harvested product of the enterprise's biological assets). This diversity is causing difficulties for stakeholders in the agricultural sector.

Staff Contact(s)

Lester Cheng, CPA, CA

Director, Accounting Standards Board

Read what stakeholders had to say about the Discussion Paper, Agriculture

Support Materials

Background

During the development of accounting standards for private enterprises, the AcSB considered developing authoritative guidance on agriculture. The AcSB concluded that given the length of time needed to develop such guidance and the more pressing need for accounting standards for private enterprises in the short term, a project on this topic would be deferred until accounting standards for private enterprises in Part II of the CPA Canada Handbook – Accounting were issued and in use for a period of time.

The agricultural sector is an important part of the Canadian economy and spans a wide range of activities. Statistics Canada reported in 2011 that the agricultural and agri-food sectors accounted for 8 percent of Canadian GDP, at $101.1 billion, and that there were 205,730 farm businesses.

This Discussion Paper aims to obtain broad input from stakeholders, in particular, those involved in the agricultural sector. This input will assist the AcSB in deciding whether to develop authoritative guidance, either by developing a new standard or amending existing standards, on accounting for biological assets and agricultural produce by private enterprises and, if so, the issues to be addressed and how they could be addressed.