DO THE CERTIFIED ACCOUNTANTS KNOW THE MENSURATION OF BIOLOGICAL ASSETS AT FAIR VALUE? AN ANALYSIS OF THE CENTRAL REGION OF PORTUGAL

Abstract

Accounting regulation has evolved considerably concerning agricultural activity. Fair value relevance, as a basis for accounting measurement, instead of historical cost, led to the emergence of more specific standards in this sector, measuring the fair value of biological assets and agricultural products. The European Union has adopted the International Accounting Standards (Regulation 1606/2002 of 19 July 2002), providing the necessary ground for a new accounting standards system in Portugal (Sistema de Normalização Contabilística - SNC). This new paradigm hosts, particularly, fair value measurement, without historical cost suppression. In this paper will be analysed to what level the Certified Accountants in Portugal (Centre Region) are familiar with SNC specially NCFR 17, and if it provides a more accurate and proper view, comparatively to historical cost. We will also analyze the (in)adequacy of historical cost in agricultural activity and some specific aspects of NCRF 17. At last, it will be analysed market/fair value, compared to historical cost, presents greater or lower operationalization/implementation complexity. From the study performed, done through descriptive analysis of an inquiry, it is concluded that the Certified Accountants (Centre Region) SNC's knowledge and training is satisfactory but is insufficient to what NCRF 17 is concerned.