FINANCIAL

ACCOUNTING FOR
AGRICULTURE SUBMITTED BY
M. SRI HIMAJA
F20031
INTRODUCTION
 Major share of the national income of the country is contributed by agriculture.
 In India agriculture is operated and maintained by family of farmers.
 The proper financial accounting is not maintained in agriculture therefore, attention should
be given on proper accounting in agriculture.
 Though India’s economy has been recording rapid industrial progress yet it still is based
principally on agriculture and more than 75% people of the country are directly or
indirectly engaged in this profession.
MEANING

FINANCIAL ACCOUNTING:
The primary function of financial accounting is to gather information and
produce reports on an organization's financial activity. They summarize
transactions for a company, describing what company made the transaction with
you and the date and amount of each transaction.

AGRICULTURAL FINANCIAL ACCOUNTING:

Agricultural accounting is the application of accounting practices to farm
activities to ascertain the cost and profit.
ROLE OF AGRI.MARKETING

 Role is to maintain accounting procedures and ensure appropriate internal records.

 To go with year or season end financial reporting to know the status of farm
profits and activities.
 They must analyse the report and make decision on financial dealings for the
farm.
 To provide detailed information on crop wise performance.
OBJECTIVES
 To detect loss or theft of cash or stock.
 To provide the necessary data for a correct income tax assessment.
 To claim expenses for work done by others.
 Farm accounts provide the indispensable tool for farm management. In
other words, accounting is needed to obtain and to maintain the most
profitable use of farm resources. Keeping farm accounts is the only way to
reveal the weak spots in the farm's business and show where and how to
improve management so as to arrive at a larger income. Note that accounts
cannot by themselves teach a farmer how to farm, but they can without
doubt assist the farmer to use agricultural knowledge to best advantage.
NEED FOR ACCOUNTING
AGRICULTURE
 Providing acceptable accounting rewards, helps to get finance from banks.
 Crop wise performance is known, thus profitable and unprofitable activities can
be identified and corrective measures can be taken.
 Detailed information on yield, revenue, input and cost of the farm is available.
 The owner of the farm can have better control over farm activities.
 Compensation can be easily claimed from government or insurance company in
case of loss due to natural calamities.
Ind as 41 agriculture

 This standard is related to agriculture, where it provides guidelines for the

treatment of agriculture accounting.
 This Standard is applied to account for Biological Assets, Agricultural Produce,
and Government Grants.
 This standard is not applied for property, plant, and equipment, bearer plants,
Intangible Assets related to agriculture activity.
IMPORTANCE

 It helps to know the income and expenses incurred.

 The strategies may imply to reduce the expenses.
 It helps to increase the efficiency of an agriculturist.
 It helps to know the actual profit from Agriculture.
 It helps in future estimation.
 It helps to know the cost of yield.
THANK YOU