IMPLICATIONS OF IMPLEMENTATION OF IAS 41 ABOUT AGRICULTURE ON FORESTRY ACCOUNTING IN INDONESIA

Abstract

Forest is one of natural resourcs that must be accountably managed. State entitles company to manage production forests. Corporate accountability of concession permit holder is reflected in the financial statements prepared by the company. The company that holds forest concession right manages forest which is one form of biological assets and produces a form of agricultural products. IAS 41 specifies the accounting treatment for biological assets and agricultural products This paper describes analyses on the implications of the implementation of IAS 41 in Indonesia. The forestry industry is an industry that is regulated by the government, because the entity manages state’s assets should be utilized as much as possible for the public prosperity. On the other hand the international forces require entities to prepare financial statements in accordance with applicable accounting practices internationally. Standard setter should be careful in setting forestry accounting standards, because it is feared that the standards applied contrary to the regulations in Indonesia, which can rises some problems in the application and implementation.