Legal Research
Legislations
AASB 2014-6 - Amendments to Australian Accounting Standards – Agriculture: Bearer Plants

AASB 2014-6 - Amendments to Australian Accounting Standards – Agriculture: Bearer Plants

Administered by Department of the Treasury

Legislation au F2015L00106 Not in force Legislative Instrument

Select Document

Explanatory Statement

Accounting Standard AASB 2014-6
Amendments to Australian Accounting Standards – Agriculture: Bearer Plants

December 2014

EXPLANATORY STATEMENT

Reasons for Issuing AASB 2014-6

AASB 2014-6 Amendments to Amendments to Australian Accounting Standards – Agriculture: Bearer Plants makes amendments to the following Standards:

AASB 101 Presentation of Financial Statements;
AASB 116 Property, Plant and Equipment;
AASB 117 Leases;
AASB 123 Borrowing Costs;
AASB 136 Impairment of Assets;
AASB 140 Investment Property; and
AASB 141 Agriculture.

These amendments arise from the issuance of Agriculture: Bearer Plants (Amendments to IAS 16 and IAS 41) by the International Accounting Standards Board in June 2014, and to make editorial corrections.

Main Features of AASB 2014-6

Main Requirements

The amendments define a bearer plant and require bearer plants to be accounted for as property, plant and equipment and included within the scope of AASB 116 Property, Plant and Equipment, instead of AASB 141 Agriculture.

A bearer plant is defined as a living plant that is used in the production or supply of agricultural produce, is expected to bear produce for more than one period and has a remote likelihood of being sold as agricultural produce, except for incidental scrap sales.

Plants such as tea bushes, grape vines, oil palms and rubber trees, would usually meet the definition of a bearer plant and would be within the scope of AASB 116.

The produce growing on bearer plants, for example, tea leaves, grapes, oil palm fruit and latex would remain within the scope of AASB 141.

This Standard also makes various editorial corrections to Australian Accounting Standards.

Application Date

This Standard applies to annual reporting periods beginning on or after 1 January 2016. Earlier application is permitted for annual reporting periods beginning on or after 1 January 2005 but before 1 January 2016.

Consultation Prior to Issuing this Standard

The AASB issued Exposure Draft ED 245 Agriculture: Bearer Plants in July 2013 for comment by 1 October 2013.

Four submissions were received by the AASB in respect of the proposals in ED 245 and there was general support for adopting the proposals in Australian Accounting Standards. The AASB considered the comments it received in making its submission to the IASB and in finalising AASB 2014‑6.

A Regulation Impact Statement (RIS) has not been prepared in connection with the issue of AASB 2014-6 as the amendments made are minor in nature.

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011

Accounting Standard AASB 2014-6
Amendments to Australian Accounting Standards – Agriculture: Bearer Plants

Overview of the Accounting Standard

The amendments in AASB 2014-6 Amendments to Australian Accounting Standards – Agriculture: Bearer Plants define a bearer plant and require bearer plants to be accounted for as property, plant and equipment and included within the scope of AASB 116, instead of AASB 141.

Plants such as tea bushes, grape vines, oil palms and rubber trees, would usually meet the definition of a bearer plant and would be within the scope of AASB 116.

The produce growing on bearer plants, for example, tea leaves, grapes, oil palm fruit and latex would remain within the scope of AASB 141.

Human Rights Implications

This Standard is issued by the AASB in furtherance of the objective of facilitating the Australian economy. It does not diminish or limit any of the applicable human rights or freedoms, and thus does not raise any human rights issues.

Conclusion

This Standard is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview

The Accounting Standard AASB 2014-6, titled Amendments to Australian Accounting Standards – Agriculture: Bearer Plants, was enacted in 2014. It was introduced to address the need for a consistent accounting treatment of bearer plants in the agricultural sector. The Australian Accounting Standards Board (AASB), which is the body responsible for developing accounting standards in Australia, issued this amendment to align Australian standards with the International Accounting Standards Board's (IASB) Agriculture: Bearer Plants (Amendments to IAS 16 and IAS 41), released in June 2014. The overarching policy objective of this amendment is to ensure that accounting practices within the agricultural sector are transparent, consistent, and comparable both domestically and internationally, thereby facilitating the Australian economy.

Scope and Application

AASB 2014-6 Amendments to Australian Accounting Standards – Agriculture: Bearer Plants applies to entities preparing financial statements in accordance with Australian Accounting Standards. Specifically, it concerns the accounting treatment of bearer plants, which are defined as living plants used in the production or supply of agricultural produce, expected to bear produce for more than one period, and having a remote likelihood of being sold as agricultural produce except for incidental scrap sales. The entities impacted are primarily those in the agricultural industry, including those cultivating plants such as tea bushes, grape vines, oil palms, and rubber trees. The amendments necessitate that these bearer plants be accounted for as property, plant, and equipment and included within the scope of AASB 116, instead of AASB 141. This change, which aligns with the International Accounting Standards Board's amendments, applies to annual reporting periods beginning on or after 1 January 2016, with earlier application permitted. The Act is applicable nationally across Australia, encompassing both Commonwealth and state jurisdictions, though the specifics of its implementation may vary by state or territory regulations. There are no specific exclusions or exemptions noted within the text, though the amendments themselves are considered minor in nature.

Key Provisions

The main operative sections of AASB 2014-6 Amendments to Australian Accounting Standards – Agriculture: Bearer Plants (Section 2) define a bearer plant and require these plants to be accounted for as property, plant and equipment under AASB 116. This includes plants such as tea bushes, grape vines, oil palms, and rubber trees, which would typically fall under this definition. The produce from these plants, such as tea leaves, grapes, oil palm fruit, and latex, remains within the scope of AASB 141 Agriculture. These amendments also include various editorial corrections to existing Australian Accounting Standards. The Act imposes obligations on entities to properly account for bearer plants by classifying them as property, plant, and equipment. This classification means that bearer plants must be recorded at cost and depreciated over their useful life, consistent with the requirements of AASB 116. Entities must also ensure that the produce harvested from these plants is accounted for separately under AASB 141. The amendments apply to annual reporting periods beginning on or after 1 January 2016, with earlier application permitted for periods beginning after 1 January 2005 but before 1 January 2016. Breaches of these accounting requirements may lead to financial misstatements, which can result in regulatory scrutiny or investigations by relevant authorities. While the penalties for non-compliance are not explicitly detailed in the explanatory statement, it is important for entities to adhere to these standards to avoid potential civil or criminal liabilities associated with financial reporting inaccuracies. The consequences of non-compliance can include financial penalties, legal action, and reputational damage.

Area of Law: Commercial Law; Accounting
Instrument: Regulation
Concepts: Definitions & Interpretation; Compliance Obligations; Repeal & Amendment

Interactions

Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.

Legislation content