Leatherwood Flower Trees: A Public Asset for Tasmania's Honey Industry

This report examines the Leatherwood flower trees in Tasmania and their significance as a public asset for the honey industry. It discusses the impact of wildfires on the trees and the potential use of the Commonwealth disaster fund to protect them. The report also explores the economic benefits of the Leatherwood trees and suggests regulations to ensure their sustainable use.

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Leatherwood Flower Trees
(Name)
Course
Professor
Affiliated Institute
Date

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Dear Mr. Terror,
In Tasmania, beekeeping is a major economic activity. The activity is mainly carried out
in the rain forest which consists of Leatherwood flower trees that flower all year long. Individual
farmers and organization have hundreds of beehives in these trees that grow up to 6 meters in
length. The quality of honey that is processed from these beehives has created a large market for
the honey in the region and the country at large, however, this season the trees have struggled to
flower which has affected the quantity of honey processed and to make matters worse wildfires
have been burning down the wild trees since early December. Huge hectares have been
destroyed, and it is estimated that more damage will be caused by the wildfire if the climate does
not change soon. It takes approximately 100 years for a leatherwood tree flower to grow fully
and once it is destroyed, it can never be recovered (ABC News, 2019). In this report, we are
going to look at the Leatherwood trees and could be considered as a public asset according to
accounting principles and convention in a bid to determining how the government will use the
Commonwealth disaster fund to assist in this wildfire crisis.
Accountants define assets as something controlled by an organization or entity with the
present value to provide services or future potential to generate income for the organization. A
public asset is managed by the government both national and local (Novak, 2013). The
government can use the assets to create social capital, provide required infrastructure, and come
up with an economic activity using the available resource to generate revenue.
By this definition, the Leatherwood tree flower can be considered a public asset as the
government definitely benefits from the honey business through the various taxes paid by the
honey processing plants and the consumers once they buy the final product. There are
predictions that the honey prices will go up due to the shortages created by the wildfires which

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will consequently affect the revenue generated by the government. When the price of a jar of
honey goes up, the demand for the product will decrease as not all consumers will be
willing/able to purchase the product at the new price hence reducing revenue for both the farmers
and the government.
According to the Australian Accounting Standard Board (AASB), assets include plants,
machinery, and equipment that are held for the provision of services or the production of goods
(Kober, Lee and Ng, 2012). The Leatherwood trees could be categorized in the same group as
they both, directly and indirectly, affect the production of honey. The tree flowers all year
providing bees with the required nector to produce honey while they indirectly support the trade
by housing the beehives. The AASB formulates most of its accounting rules based on the
International Accounting Standards Board (IASB) based in London to make regulations that are
in line with those of the international accounting board (Warren, 2016). As Australia is a
member of the Commonwealth, the Commonwealth disaster fund can be used by the national
government in the wildfires disaster as long as the Leatherwood trees are recognized as public
assets.
Statisticians define environmental assets in the same way economics assets are defined.
These are assets that can be recognized by the owner, and the owner can prove that they can
derive economic benefits from the assets (Smith, Boje and Foster III, 2013). Most of the
Leatherwood trees are so close together covering many hectares that are not accessible by any
other means of transport other than walking. The government could categorize this as a forest
where the farmers and the government derive economic benefits (Stevenson, 2012). It is true that
large hectares of the leatherwood trees were destroyed, but there are still many hectares of trees

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that can generate the government more revenue other than the income they get from the honey
business.
The government can also market the area covered by the thick Leatherwood trees as a
tourist attraction. This in effect makes the leatherwood trees a public asset that the government
has the obligation of protecting to gain economic benefits (Stiglitz and Rosengard, n.d.). The
Commonwealth is an organization made up of countries that were colonized by the British, and
they collectively define a public asset as personal property that is paid for by a town or even a
political subdivision as long as one person does not own it. The Commonwealth disaster fund
can be used for many purposes towards helping the Leatherwood flower trees. The remaining
Leatherwood trees could be protected against the wildfires by equipping the firefighters with
more resources that improve their response time and increase the number of personnel. It also
takes a very long time for naturally growing Leatherwood flower trees. The government could
start an artificial Leatherwood tree planting that could replace the burnt down trees in a shorter
period.
Leatherwood trees will be considered tangible assets according to the Australian
accounting standards. Tangible assets are assets that have a physical form and can either be a
current or a fixed asset (Zeb and Froese, 2014). Leatherwood trees are fixed assets that take more
than 100 years to develop fully. As a fixed asset, The Commonwealth fund could be used more
than one time to help save the Leatherwood trees. Just like a forest cover, the government could
work to protect the Leatherwood trees for their economic benefit for the people of Tasmania.
The Tasmanian Premier has insisted that the Commonwealth fund will not be used to
rehabilitated parks and wildlife, but in our case, it will inevitably be a by-product of saving the
Leatherwood trees (Jarvie, 2019). The main aim of the fund will be to protect the remaining

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hectares of the trees not forgetting the immense number of funds spent to ensure that the
wildfires did not destroy all hives in the affects areas. If the government were to step in, the
animals that have fled the affected areas would find refuge in the remaining hectares of trees. For
beekeeping to thrive in the remaining areas, there will be a need for minimal interaction with the
outside world. If only a few access roads are built, it would be for the best. The fund will only
be used to protect the remaining trees while the governments look for ways to artificially replace
the trees that were lost in the wildfire.
Tasmanians are also going to benefit when Leatherwood tree flowers are considered a
public asset. As it is the situation now, farmers can go into the wilderness and erect their hives to
get as much honey as each would like but when a natural disaster occurs such as the wildfire, the
farmer's associations and processing plants have no means to handle such a disaster as it will lead
to losses. Seventy percent of all the honey is produced by the rainforest (Jarvie, 2019) implying
that the wildfires have caused significant losses to the amount of revenue that is going to be
generated from the quantity of honey harvested.
As a public asset, the government could easily increase the number of emergency
services available hence limiting the damage that the wildfire could have caused. The
commonwealth fund also covers any community that is affected by the wildfires which will
mostly be inhabited by the bee farmers. As discussed earlier, the fund can only be used if the part
of the rainforest covered by the Leatherwood trees is considered a public asset so that no
organization or individual can lay claim to the natural resource (Francl, 2013).
Apart from accounting the government could issue regulations on how the rainforest will
be used to avoid creating a man-made catastrophe. Honey is harvested after bees are chased
away using smoke where some farmers might still be using the traditional methods of lighting

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fires in the forest which could be very dangerous especially in the dry season (Deori et al., 2017).
As a public asset, the government could issue a regulation on the acceptable method of
harvesting honey that may not lead to the depreciation of the forest through fires which will
reduce the forest size.
As you can Mr. Tudor, from my analysis above, it is possible for the government to make
the rainforest a public asset, but some regulations have to be enforced according to AASB which
follows the International Financial Reporting Standards. The rain forest will be considered a
fixed asset under the supervision of the government only to ensure that the set regulation of using
the public asset is adhered to by all those who are willing to make use of the forest (Irwin, 2016).
The government will strictly play a supervisory role in a capacity of trying to protect the public
asset. These are the only conditions under which the government could use the Commonwealth
fund and other emergency funds to try and control the wildfire and save most of the remaining
rainforest. The wildlife will migrate to the unaffected areas of the rainforest after a while. No
funds will be required for relocation of wildlife as the forest cover is mostly continuous.

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References
Novak, A. (2013). Harmonization of Australian Accounting Standards with International
Financial Reporting Standards. SSRN Electronic Journal.
Smith, W., Boje, D. and Foster III, T. (2013). A tetranormalization intervention of the Financial
Accounting Standards Board (FASB) and the International Accounting Standards Board
(IASB). Recherches en Sciences de Gestion, 99(6), p.65.
Jarvie, E. (2019). Federal funds granted to assist Tasmanian bushfire recovery. [online] The
Advocate. Available at: https://www.theadvocate.com.au/story/5870759/federal-funds-granted-
to-assist-tasmanian-bushfire-recovery/ [Accessed 21 Mar. 2019].
ABC News. (2019). 'It's just a disaster': Fires deal massive blow to honey industry. [online]
Available at: https://www.abc.net.au/news/2019-02-05/tasmanian-bushfires-burn-leatherwood-
in-blow-to-honey-industry/10776606 [Accessed 21 Mar. 2019].
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stakeholders. Accounting & Finance, 53(2), pp.471-496.
Stevenson, K. (2012). The Changing IASB and AASB Relationship. Australian Accounting
Review, 22(3), pp.239-243.
Stiglitz, J. and Rosengard, J. (n.d.). Economics of the public sector.
Zeb, J. and Froese, T. (2014). Tangible capital asset ontology in infrastructure
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Francl, M. (2013). Tangible assets. Nature Chemistry, 5(3), pp.147-148.
Warren, C. (2016). The impact of International Accounting Standards Board
(IASB)/International Financial Reporting Standard 16 (IFRS 16). Property Management, 34(3).

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Irwin, T. (2016). Dispelling fiscal illusions: how much progress have governments made in
getting assets and liabilities on balance sheet?. Public Money & Management, 36(3), pp.219-226.
Deori, B., Deb, P., Singha, H. and Choudhury, M. (2017). Traditional honey harvesting by the
Pnar community of South Assam, India. Our Nature, 14(1), pp.13-21.