Research article

Challenges in accounting the forests - a Latvian case study

Evija Grege-Staltmane

Evija Grege-Staltmane
Forest Faculty, Latvia University of Agriculture, 11 Akademijas Str., Jelgava, LV-3001. Email: evija_g2002@yahoo.com

Online First: March 30, 2010
Grege-Staltmane, E. 2010. Challenges in accounting the forests - a Latvian case study. Annals of Forest Research 53(1): 51-58.


Forest has a long production cycle. Therefore forest bookkeeping has specific characteristics. However accounting for forest activities has received little attention from accounting researchers. The release of International Accounting Standard 41 "Agriculture" (IAS 41) established a single accounting system for forest assets. The paper analyzes application of IAS 41 which regulates forest accounting. Practice of international forestry companies is examined, and current forest accounting situation in Latvia is investigated. The main factors affecting valuation of a forest in its fair value are discussed and major problems in forest accounting are illuminated. The research indicates that land value and standing timber value should be recorded separately and standing timber should be estimated at its fair value. Despite the attempt of the International Accounting Standard Board to improve the accounting with IAS 41 for biological assets, much enhancement in forest accounting is still needed. 

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