Accounting Treatment of Assets: Analysis based on IAS Standards

This report provides an analysis of the accounting treatment of various assets in accordance with International Accounting Standards (IAS). It focuses on IAS 41 for biological assets, which are measured at fair value less costs to sell, and IAS 16 for Property, Plant, and Equipment (PPE), emphasizing the determination of carrying value and depreciation. Furthermore, it addresses IAS 38 for intangible assets, highlighting the criteria for recognition based on the probability of future economic benefits and reliable cost measurement. The report underscores the importance of disclosures regarding asset type, valuation method, and accounting treatment. It concludes by noting the significant differences in valuation methods across these asset categories and encourages further exploration of these standards for comprehensive understanding. Desklib provides a platform for students to access past papers and solved assignments for additional learning resources.

Accounting Assignment

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By student name
Professor
University
Date: 27th March, 2019.
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Contents
Analysis........................................................................................................................................................3
References...................................................................................................................................................4
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Analysis
The accounting treatment of biological asset comes under IAS 41 that sets out the accounting for
biological assets that includes living plants and animal. In this case, the assets are measured at fair value
less the overall costs to sell. The cost to sales includes the incremental cost that is directly attributable to
the disposal of an asset and does not include financing cost and income taxes. While in the case of PPE
IAS 16 sets out the accounting treatment for most of the assets, the principal issues in case of
recognition of these assets determination of their overall carrying value and the impairment loss that is
related to them. It also is important that proper depreciation is calculated. In the case of intangible
assets IAS 38 Lays down the principles for the recognition and valuation of these assets. It states that
intangible assets shall be recognized only if the following criteria are met which includes that there is a
probability that future economic benefits shall flow from the assets to the entity and that the overall
cost of the asset can be measured reliably.Hence their overall identification and valuation is a bit
complex to the organization. In case of these standards it is important that necessary disclosures with
respect to the type of asset, the overall valuation method followed, and the accounting treatment
should be given in disclosures. So, we that there is a huge difference in the methods that have been
followed for the valuation of these different kinds of asset.
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References
Abdullah, W., & Said, R. (2017). Religious, Educational Background and Corporate Crime Tolerance by
Accounting Professionals. State-of-the-Art Theories and Empirical Evidence, 129-149.
Vieira, R., O’Dwyer, B., & Schneider, R. (2017). Aligning Strategy and Performance Management Systems.
SAGE Journals, 30(1), 23-48.
Webster, T. (2017). Successful Ethical Decision-Making Practices from the Professional Accountants'
Perspective. ProQuest Dissertations Publishing, 3(1), 142-156.
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