Accounting for Agricultural Land Use: Present-Day State and Potential Possibilities of Its Improvement

The Article provides the analysis of present day accounting for agricultural land usage by agricultural enterprises of different types of ownership and highlights the potential possibilities of its improvement. It has been found that most private agricultural enterprises do not maintain off-balance sheet accounting of the lands leased which total over 95% in their land fund structure and accountants do not find it reasonable to include the lease rights on accounting balance sheet. According to the author, this situation is the result of declarative nature of management responsibilities for the organization of accounting in the company and lack of requests for information on land use from the state agencies and other users. Besides, the scientifically grounded benefits of inclusion of leasing rights to agricultural company balance sheets are inaccessible in practice. In the state-owned enterprises the status of accounting for agricultural land use is much better, yet there are cases of non-compliance of accounting practices with the accounting legislation requirements. It has been found that reflection of the right to permanent use of land plots in accounting does not affect financial performance of the state enterprises and, thus, account information on the rights of use actually is for reference purposes only. Improvement of accounting for agricultural land use in private agricultural enterprises is possible through the implementation of specific approaches characteristic of finance lease accounting and scientifically grounded mechanisms of reflection of lease rights on accounts as intangible assets. However, the science approaches worked will become a part accounting practice only upon the availability of requests for information formed in accordance with them, and understanding of such innovations appropriateness by accountants.