Accounting Process for Government Grants in Hazelnut Production within the Framework of International Accounting Standards: Turkey Sample

The subject of the study is the accounting of government grants for agricultural activities according to International Accounting Standards (IAS). In this context, IAS examines the government grants for agriculture under two standards. These standards are “IAS 41 Agriculture” and “IAS 20 Accounting for Government Grants and Disclosure of Government Assistance”. If a government grant related to a biological asset measured at its fair value less costs to sell to be recognized in profit or loss IAS 41 is applied but if a government grant relates to a biological asset measured at its cost less any accumulated depreciation and any accumulated impairment losses, IAS 20 is applied. The aim of this study is explaining the way for the accounting of government grants like “field-based income support” and "agricultural production support" for multi-stemmed shrubs (hazelnut trees) which are considered as a bearer plant. With this aim case study method was used and the subject of the study was illustrated by examining journal entries of government grants for hazelnut orchards of one of the leading companies in hazelnut industry in Turkey. Also, a diagram was developed for business which makes easier to decide to choice standard for accounting of any government grants for agriculture.