Measurement of Cattle under IAS 41 (Agriculture):

1. Initial Recognition:
   • The cattle are classified as biological assets under IAS 41.
   • At initial recognition, the cattle should be measured at fair value less costs to sell, unless the fair value cannot be reliably measured.
   • If fair value cannot be reliably measured, the cattle should initially be measured at cost.
2. Subsequent Measurement:
   • After initial recognition, the cattle should be re-measured at each reporting date to fair value less costs to sell.
   • Changes in the fair value of the cattle, whether gains or losses, should be recognised in the profit or loss for the reporting period.
3. Determining Fair Value:
   • Fair value can be determined using market prices for cattle of similar age, breed, and condition in an active market.
   • If market prices are unavailable, fair value may be estimated using other valuation techniques such as discounted cash flow models or prices of comparable livestock.
4. Costs to Sell:
   • Costs to sell include incremental costs directly attributable to the sale, such as transportation and market commissions. Administrative costs are excluded.
5. Presentation in Financial Statements:
   • The cattle should be presented as biological assets in the statement of financial position.
   • Changes in the fair value should be presented as part of profit or loss under “fair value adjustments” or similar headings.
6. Disclosure Requirements:
   • Disclosures should include the methods and assumptions used in determining fair value, as well as the nature of the assets, changes in fair value, and any restrictions on the biological assets.