Interpretation and Application of IPSAS

17 Specific Standards: Accounting for Agriculture and Accounting in Hyperinflation Economies

This chapter covers IPSAS 27 Agriculture and IPSAS 10 Financial Reporting in Hyperinflationary Economies. These are two specific IPSAS standards, one linked to the activity, the other one linked to the economical and monetary environment:

• IPSAS 27 relates to reporting on agricultural activity, which is of marginal relevance to most public sector entities; and
• IPSAS 10 is aimed at entities whose functional currency is the currency of a hyperinflationary economy.

Agriculture (IPSAS 27)

Reporting on agricultural activity is of marginal relevance to most public sector accounts preparers, although significant in some jurisdictions, notably in countries where part or all of agricultural land and activities are state owned. An agricultural activity is the management by an entity of the biological transformation of biological assets: for sale, into agricultural produce, or into additional biological assets.

Farming and the agricultural sector have many unique aspects. For example, animals and plants, described as biological assets, have characteristics which are not present in other industries. Another significant feature is that government assistance in the agricultural sector is common and is often substantial. However assistance does not necessarily mean that IPSAS 27 is to be applied to these activities.

For instance, the mission of World Food Programme (WFP):

is to end global hunger. ...