Practical Assessment (Real Life) of Agricultural Accounting in Ahmara Region, Ethiopia The Case of Bahir Dar Town Agricultural Firm

Abstract

This paper used qualitative approach to understand the practice of agricultural accounting systems in the Ahmara region agricultural firms. Unstructured interview was used to collect data from the interviewees to achieve the research objectives.  Three governmental organizations which have primary concern with the subject matter has been visited to obtain vital information about agricultural activity-Dairy farming and oxen fattening activities. Particularly, this study visit one sole-proprietor and one Co-operative and interviewed all employees especially interviewed the manager of cooperative to realize the current practices of agricultural accounting systems in cooperative. The findings indicated that agricultural accounting is not different from all other business accounting given no books of accounts are maintained, in the IAS 41, fair value measurement, recognition and disclosure, are nonexistent in the business. In addition, in cooperative difficult to make conclusions whether costs are capitalized or expensed while also the business cannot clearly segregate the assets of the business from personal ones. Finally, the study shows that no balance sheet and operating result statements are prepared by the firms.

Keywords: Accounting Systems, Agriculture, IAS 41, Biology Assets.