What Is the Meaning of Biological Assets?

by Connie s Owens; Updated September 26, 2017
Cows on pasture

Accounting practices offer categories for assets--the property, buildings, machines, animals, crops and other items produced and sold for a profit. The general practice extends around the world. By categorizing assets, a business is able to offer a view into the practices and overall value it offers. Income statements and balance sheets can give a general value of a business. The term biological assets is one of many that accounting principles defines and utilizes.


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Biological assets are animals and plants. Farms are a typical business where biological assets are the primary income. A business raising animals or crops for profit is required to keep a record and include them in the balance and income statements. Once a crop is harvested and livestock slaughtered the status changes from biological to agricultural produce.


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The most important distinction is that biological assets are non-human. The classification includes mammals; animals; plants including trees, vineyards, fruit orchards, vegetables and herbal crops; and fish. Animals and plants not included as biological assets are dogs, horses, pigeons or other animals used for racing; animals used in theme parks, such as pony rides; and the biologicals categorized as viruses, bacteria and blood cells.



The purpose of utilizing and defining the term biological assets is one way of tracking and valuing the income of a business. Each country's government has developed procedures to follow in listing and valuing biological assets. A fair market value is set accordingly, considerations are made in regards to the age of the biological asset and its ability to procreate.

The Facts

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The term biological assets is unique to accounting practices. The purpose of categorizing animals and plants as biological assets can offer a clear picture of value to the farm or business. Because there are many businesses that raise dogs, horses and other animals for a variety of purposes, it is necessary to clearly define the term biological asset.


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The ability to discern the different assets a business holds may offer clear financial information. Accounting considerations for biological assets has offered different views on valuing. If the biological asset is consumable, like poultry, livestock or crops, the value varies as do the accounting principles. Australia, China, the United States and England are a few of the countries that utilize a universal accounting practice for listing and valuing biological assets.

About the Author

Connie comes to Demand Studios with a diverse background including substance abuse counseling and spiritual guidance. Connie Owens began writing four years ago on a variety of topics that capture her interest. Her recent articles have been on health, animal care, psychology, and personal observations. Connie's articles have been featured on Associated Content and Helium, as well as her own website blogs.

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