At its meeting on March 6-7, 2019, the AcSB continued its discussion on the Exposure Draft. The Board considered advice from its Agriculture Advisory Group to address stakeholder feedback. The Board considered this feedback and decided to reflect the following changes from the Exposure Draft in the final standard:

1. replace the condition that costs of disposal be “relatively insignificant” to measure agricultural inventories using the net realizable value model, with the condition that costs of disposal be “predictable and reliably measurable.”;
2. permit the accounting policy choice to determine cost using only input costs to be applied consistently to agricultural inventories measured using the cost model “of a similar nature and use,” rather than to “all” such agricultural inventories;
3. permit a retrospective change to the accounting policy for the determination of cost from using full cost to only input costs. The AcSB considered forestry industry concerns regarding the inclusion of the forestry industry’s activities within the scope of the proposed guidance.

The Board decided to exclude forestry from the scope of the proposed standard on the following bases:

1. in Canada, the vast majority of managed forestry activities occur on publicly owned lands and as a result: (a) very few private enterprises engage in forestry activities on private industrial lands; and (b) well-established practices in this industry stem from public policy and regulation; and
2. there is a weak relationship between patterns of cost incurrence and expected future economic benefits due to the long-term nature of biological transformation in the forestry industry.

The AcSB also decided to make several clarifications to the final standard and to develop illustrative examples. In May 2019, it plans to consider outstanding issues and review a draft of the final standard reflecting its decisions to date.

Review the Executive Summary on the AcSB's Web site.