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Impact of Fair Value Accounting on Biological Assets in Agricultural Sector in Nigeria

Received: 30 May 2019     Accepted: 17 July 2019     Published: 5 August 2019
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Abstract

This study critically reviewed the impact of fair value accounting on biological assets of Nigerian agricultural sector with a focus on Okomu Oil Palm Company Plcfor the period of 2009-2018. The study adopted ex-post facto research design. Analytical techniques employed were descriptive statistics and Ordinary Least Squares (OLS) multiple regression analysis. Findings revealed that fair value accounting operationalized by non-current asset, profit after tax, and current assets have insignificant positive effect on the biological assets of the Nigerian Agricultural firms. The implication is that the company reports gain in their biological assets when the fair values of their assets increases. Based on these findings, it was recommended among others that there is need for agricultural firms to adopt the fair value accounting system in other to keep proper records of its biological assets.

Published in International Journal of Finance and Banking Research (Volume 5, Issue 4)
DOI 10.11648/j.ijfbr.20190504.11
Page(s) 64-70
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2019. Published by Science Publishing Group

Keywords

Fair Value, Biological Assets, Ordinary Least Squares Regression, Agricultural Sector

References
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[3] Ryan, S. G. (2008). Fair value accounting: Understanding the issues raised by the credit crunch. Council of Institutional Investors, 1-24.
[4] IFRS (2009). A practical guide to accounting for agricultural assets November. Price Water House Coopers Retrieved on March 27 2019 from https://www.pwc.com/gx/en/ifrs-reporting/pdf/a_practical_guide_to_accounting_for_agricultural_assets.pdf
[5] Sanja, S. M., Ivana, M. S. &Mateja, B. (2016). Valuation of biological assets under IAS 41 – the case of listed and large companies in Croatia. Research World International Conference, Barcelona, Spain, 44-50.
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[10] IASB, International Accounting Standard 41 – Agriculture, EC staff consolidated version as of 16 September 2009. Retrieved from: http://www.iasplus.com/en/standards/ias/ias41 on April 15, 2019.
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[14] Dorel, M., Veronica, G., Elena, H., Ionel, B., Ovidiu, B., Aura, D., Maria, M. &Alin, A. (2015). Biological assets and the agricultural products in the context of the implementation of the IAS 41: A case study of the Romanian agro-food system. Arch. Biol. Sci., Belgrade, 67 (2), 705-714.
[15] Biljon, M. V. (2016). An application guideline for the fair value accounting of biological assets. University of South Africa, 1-315.
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[17] Kazmouz, B. (2010). The Effect of Applying Fair Value on the Financial Statements of UK Leading Companies. An M.Sc. Dissertation, Department of Accounting and Finance; Arab British Academy for Higher Education.
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  • APA Style

    Ubesie Madubuko Cyril, Nnajieze Ifeyinwa Elizabeth, Mbah Chris Chukwuemeka. (2019). Impact of Fair Value Accounting on Biological Assets in Agricultural Sector in Nigeria. International Journal of Finance and Banking Research, 5(4), 64-70. https://doi.org/10.11648/j.ijfbr.20190504.11

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    ACS Style

    Ubesie Madubuko Cyril; Nnajieze Ifeyinwa Elizabeth; Mbah Chris Chukwuemeka. Impact of Fair Value Accounting on Biological Assets in Agricultural Sector in Nigeria. Int. J. Finance Bank. Res. 2019, 5(4), 64-70. doi: 10.11648/j.ijfbr.20190504.11

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    AMA Style

    Ubesie Madubuko Cyril, Nnajieze Ifeyinwa Elizabeth, Mbah Chris Chukwuemeka. Impact of Fair Value Accounting on Biological Assets in Agricultural Sector in Nigeria. Int J Finance Bank Res. 2019;5(4):64-70. doi: 10.11648/j.ijfbr.20190504.11

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  • @article{10.11648/j.ijfbr.20190504.11,
      author = {Ubesie Madubuko Cyril and Nnajieze Ifeyinwa Elizabeth and Mbah Chris Chukwuemeka},
      title = {Impact of Fair Value Accounting on Biological Assets in Agricultural Sector in Nigeria},
      journal = {International Journal of Finance and Banking Research},
      volume = {5},
      number = {4},
      pages = {64-70},
      doi = {10.11648/j.ijfbr.20190504.11},
      url = {https://doi.org/10.11648/j.ijfbr.20190504.11},
      eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijfbr.20190504.11},
      abstract = {This study critically reviewed the impact of fair value accounting on biological assets of Nigerian agricultural sector with a focus on Okomu Oil Palm Company Plcfor the period of 2009-2018. The study adopted ex-post facto research design. Analytical techniques employed were descriptive statistics and Ordinary Least Squares (OLS) multiple regression analysis. Findings revealed that fair value accounting operationalized by non-current asset, profit after tax, and current assets have insignificant positive effect on the biological assets of the Nigerian Agricultural firms. The implication is that the company reports gain in their biological assets when the fair values of their assets increases. Based on these findings, it was recommended among others that there is need for agricultural firms to adopt the fair value accounting system in other to keep proper records of its biological assets.},
     year = {2019}
    }
    

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  • TY  - JOUR
    T1  - Impact of Fair Value Accounting on Biological Assets in Agricultural Sector in Nigeria
    AU  - Ubesie Madubuko Cyril
    AU  - Nnajieze Ifeyinwa Elizabeth
    AU  - Mbah Chris Chukwuemeka
    Y1  - 2019/08/05
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    N1  - https://doi.org/10.11648/j.ijfbr.20190504.11
    DO  - 10.11648/j.ijfbr.20190504.11
    T2  - International Journal of Finance and Banking Research
    JF  - International Journal of Finance and Banking Research
    JO  - International Journal of Finance and Banking Research
    SP  - 64
    EP  - 70
    PB  - Science Publishing Group
    SN  - 2472-2278
    UR  - https://doi.org/10.11648/j.ijfbr.20190504.11
    AB  - This study critically reviewed the impact of fair value accounting on biological assets of Nigerian agricultural sector with a focus on Okomu Oil Palm Company Plcfor the period of 2009-2018. The study adopted ex-post facto research design. Analytical techniques employed were descriptive statistics and Ordinary Least Squares (OLS) multiple regression analysis. Findings revealed that fair value accounting operationalized by non-current asset, profit after tax, and current assets have insignificant positive effect on the biological assets of the Nigerian Agricultural firms. The implication is that the company reports gain in their biological assets when the fair values of their assets increases. Based on these findings, it was recommended among others that there is need for agricultural firms to adopt the fair value accounting system in other to keep proper records of its biological assets.
    VL  - 5
    IS  - 4
    ER  - 

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Author Information
  • Department of Accountancy, Faculty of Management Sciences, Enugu State University of Science and Technology (ESUT), Enugu, Nigeria

  • Department of Accountancy, Faculty of Management Sciences, Enugu State University of Science and Technology (ESUT), Enugu, Nigeria

  • Department of Marketing, Faculty of Management Sciences, Enugu State University of Science and Technology (ESUT), Enugu, Nigeria

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