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kaplan kit question 2. to my knowledge biological assets and agricultural produce are initially measured at FV-CTS. Agricultural produce are subsequently measured in accordance with IAS 2.
The question dealt with bearer plants which i assumed would fall under biological asset and would therefore be measured as FV-CTS. however the ans states that bearer plants are measured in accordance with IAS 16 and therefore its cost – dep`n.
would it be possible to have a clarification on this please?
A bearer plant is “a living plant that:
? is used in the production or supply of agricultural produce;
? is expected to bear produce for more than one period; and
? has a remote likelihood of being sold as agricultural produce, except for incidental scrap sales.”(You should see the parallel with a non-current asset.)
Bearer plants are “scoped out” of IAS 41 – IAS 16 applies.The definition captures plants that would intuitively be considered to be bearers, for instance, grape vines and fruit trees.
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