Research On The Fair Value Measurement Of Biological Assets

Accounting Standards for Enterprises No.5-Biological Assets which was issued by the Ministry of Finance asked that biological assets in China need to adopt the historical cost as the basic measurement model. With the rapid development of agricultural market,the historical cost measurement of biological assets in enterprise has showed greater limitations, has been unable to reflect the financial situation and operating results of an enterprise. Enterprises can use a variety of price channels to obtain the relevant biological asset quotation, and make a reasonable estimate of the value of biological assets of the enterprise. In 2014 the Ministry of Finance issued Accounting Standards for Enterprises.No.39-The Fair Value Measurement, which has made it possible to biological assets using fair value measurement. The problem how to implement historical cost measurement to fair value measurement model about the measurement of biological asset for our country enterprise need to be further discussed.Against this background, combined with the basic theory of biological asset and fair value measurement the thesis puts forward the argument that the biological asset has had qualification to be measured in accordance with the fair value through the analysis on the accounting evolution process and status of biological asset and the condition changes in biological asset market. The exploration of biological asset fair value in the thesis mainly includes the judgment on activeness of biological asset, confirmation of input value level; initial recognition, subsequent measurement and disclosure of biological assets fair value, and building a comprehensive and systematic accounting system of biological assets fair value. This thesis makes recommendations for revisions biological assets provisions and related accounting contents of accounting subject.Breaking through the limitation of Accounting Standards for Enterprises No.5, this thesis puts forward the whole model and the specific process for biological assets fair value. This conceptual framework will not only provide reference for the revision of Accounting Standards for Enterprises No.5 but also practical guidance for the enterprises that are going to adopt fair value to measure biological asset.