2024 Volume 15 Issue 1 Pages 157-165
The IAS 41 accounting standard for agriculture aims to standardize the accounting practices among entities engaged in agricultural production. However, there has been limited awareness and adoption of the standard, especially in the agritourism sector. This study examined accounting practices of selected agritourism farms in Region IV-A, Philippines, and aimed to identify the factors that influence their accounting practices. Interviews were conducted with eighteen farms and their financial records were reviewed. A descriptive analysis composed of mean and median rating and odds ratio analysis were performed. Additionally, sentiment analysis was conducted to evaluate the attitudes of the respondents toward the factors that influence their practices. Results indicated that most farms did not adhere to the established accounting standards for recognizing and measuring biological assets, instead relying on current practices. Only five farms recognized biological assets composed of living animals and plants, and only three farms maintained a Biological Asset account and measured it using the fair market value approach. The study highlighted that owner or management preferences, and the ease of calculation contributed very significantly to the farm’s accounting practices. Training in finance and accounting and recommendations of external auditors increased the likelihood of farms adopting the standard. Notably, sentiment analysis revealed a positive score for training, while recommendations of the auditors received a moderately positive score. The study recommends enhanced education on accounting for agriculture. A framework on how to record and measure biological assets must be developed to improve the accounting practices of agritourism farms and their compliance with accounting standards.
