A Committee on valuation of biological assets for financial statements (CVBA) was formed recently.

The committee consists of representatives of the Sri Lanka Accounting and Auditing Standards Monitoring Board (SLAASMB), the Securities and Exchange Commission (CSE), Accounting Standards Committee, Urgent Issues Task Force (UITF) of the Institute of Chartered Accountants of Sri Lanka (ICASL), Colombo Stock Exchange, Valuation Department, Forest Department and State Timber Corporation.

The inaugural meeting of the committee was held recently at SLAASMB. The meeting was chaired by Ajith Ratnayake, Director General of SLAASMB. The Chairman of the Accounting Standards Committee Asite Talwatte, Vice President of ICASL and Chairman of the Urgent Issues Task Force Nishan Fernando, the Chief Valuer P W Senaratne and senior officers from SLAASMB, ICASL, Valuation Department, SEC, CSE, Forest Department and Timber Corporation participated at the meeting.

The Committee intends to formulate guidelines for the valuation of biological assets in managed plantations for financial statements in Sri Lanka. The exposure draft is presently being formulated. When finalised, the guidelines will provide a reliable basis to value biological assets. It will provide preparers, auditors and regulators a common platform, which will enable users to place reliance on the financial statements prepared by entities which own and manage biological assets for commercial purposes.

The Committee being well represented by authorities in financial reporting, valuation, regulation, forestry and timber, is in the best position to formulate appropriate guidelines for the purpose.