CVM Resolution No. 74 of March 22, 2022 — CVM — BR

SECURITIES AND EXCHANGE COMMISSION OF BRAZIL - CVM Rua Sete de Setembro, 111/2-5th and 23-34th Floors, Center, Rio de Janeiro/RJ – ZIP: 20050-901 – Brazil - Tel.: (21) 3554-8686 Rua Cincinato Braga, 340/2nd, 3rd and 4th Floors, Bela Vista, São Paulo/ SP – ZIP: 01333-010 – Brazil - Tel.: (11) 2146-2000 SCN Q.02 – Bl. A – Ed. Corporate Financial Center, S.404/4th Floor, Brasília/DF – ZIP: 70712-900 – Brazil -Tel.: (61) 3327-2030/2031 www.gov.br/cvm

CVM RESOLUTION NO. 74, OF MARCH 22, 2022
Approves the Consolidation of Technical Pronouncement CPC 29, of the Accounting Pronouncements Committee - CPC, which deals with biological assets and agricultural produce.

The PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION OF BRAZIL - CVM makes public that the Board, in a meeting held on December 1, 2021, based on §§ 3 and 5 of art. 177 of Law No. 6.404, of December 15, 1976, combined with items II and IV of § 1 of art. 22 of Law No. 6.385, of December 7, 1976, as well as arts. 5 and 14 of Decree No. 10.139, of November 28, 2019, APPROVED the following Resolution:

Art. 1. It is made mandatory for publicly-held companies to apply Technical Pronouncement CPC 29, which deals with biological assets and agricultural produce, issued by the Accounting Pronouncements Committee - CPC, as consolidated in Annex “A” to this Resolution.

Art. 2. CVM Deliberation No. 596, of September 15, 2009, is revoked, from the effective date of this Resolution.

Art. 3. This Resolution enters into force on July 1, 2022.

Electronically signed by
Marcelo Barbosa
President

CVM RESOLUTION NO. 74, OF MARCH 22, 2022
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ANNEX “A”
ACCOUNTING PRONOUNCEMENTS COMMITTEE
TECHNICAL PRONOUNCEMENT CPC 29
BIOLOGICAL ASSETS AND AGRICULTURAL PRODUCE
Correlation to International Accounting Standards - IAS 41

Summary Item
OBJECTIVE
SCOPE 1 – 4
Definitions 5 – 9
Definitions related to the agricultural area 5 – 7 General definitions 8 – 9 RECOGNITION AND MEASUREMENT 10 – 33 Gains and losses 26 – 29 Inability to measure fair value reliably 30 – 33 GOVERNMENT GRANT 34 – 38 DISCLOSURE 39 – 57 General 40 – 53 Additional disclosure for biological asset whose fair value cannot be measured reliably 54 – 56 Government grant 57
APPENDIX – Illustrative examples

Objective
The objective of this Pronouncement is to establish the accounting treatment, and the respective disclosures, related to biological assets and agricultural produce.

Scope

This Pronouncement shall be applied to account for the following items related to agricultural activities:
(a) biological assets, except bearer plants;
(b) agricultural produce at the point of harvest; (c) government grants as set out in items 34 and 35.

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This Pronouncement is not applicable in:
(a) land related to agricultural activities (see CPC 27 – Property, Plant and Equipment and CPC 28 – Investment Property); (b) bearer plants related to agricultural activity (see CPC 27). However, this Pronouncement applies to the produce of such bearer plants; (c) government grants and assistance related to bearer plants (see CPC 07); (d) intangible assets related to agricultural activities (see CPC 04 – Intangible Assets); (e) right-of-use assets arising from leases of land related to agricultural activity (see CPC 06 – Leases).
This Pronouncement shall be applied to agricultural produce, which is considered to be that obtained at the time and point of harvest of products derived from the entity’s biological assets. After that moment, CPC 16 – Inventories, or another more appropriate Technical Pronouncement, shall be applied. Therefore, this Pronouncement does not deal with the processing of agricultural products after harvest, such as the processing of grapes to transform them into wine by a winery, even if it has cultivated and harvested the grape. Such items are excluded from this Pronouncement, even if their processing after harvest may be a logical and natural extension of the agricultural activity, and the events may have similarities.
The table below provides examples of biological assets, agricultural produce, and products resulting from processing after harvest:

Biological Assets	Agricultural Produce	Products resulting from processing after harvest
Sheep	Wool	Yarn, carpet
Timber tree plantation	Felled tree	Log, sawn timber
Dairy cattle	Milk	Cheese
Pigs	Carcass	Sausage, ham
Cotton plantation	Picked cotton	Cotton yarn, clothing
Sugarcane	Harvested cane	Sugar
Tobacco plantation	Harvested leaf	Cured tobacco
Tea bush	Harvested leaf	Tea
Grapevine	Harvested grape	Wine
Fruit tree	Harvested fruit	Processed fruit
Oil palm	Harvested fruit	Palm oil
Rubber tree	Harvested latex	Rubber product

Some plants, for example, tea bushes, grapevines, oil palm, and rubber tree, generally meet the definition of bearer plant and are within the scope of CPC 27. However, the produce of bearer plant, for example, tea leaves, grapes, palm oil, and latex, is within the scope of CPC 29.

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Definitions
Definitions related to the agricultural area
5. The following terms are used in this Pronouncement with specific meanings:
Agricultural activity is the management of the biological transformation and harvest of biological assets for sale or for conversion into agricultural produce or into additional biological assets, by the entity. Bearer plant is a living plant that:
(a) is used in the production or supply of agricultural produce; (b) is cultivated to produce produce for more than one period; and (c) has a remote possibility of being sold as agricultural produce, except for incidental sales as scrap. Agricultural produce is the harvested product of the entity’s biological asset. Biological asset is an animal and/or a living plant. Biological transformation comprises the processes of growth, degeneration, production, and procreation that cause qualitative and quantitative changes in the biological asset. Selling expenses are incremental costs directly attributable to the sale of an asset, excluding finance costs and income taxes. Group of biological assets is a group of similar living animals or plants. Harvest is the removal of the product from a biological asset or the cessation of the life of that biological asset.

5A. Bearer plants do not include:
(a) plants cultivated to be harvested as agricultural produce (for example, trees cultivated for use as timber); (b) plants cultivated for the production of agricultural produce, when there is more than a remote possibility that the entity will also harvest and sell the plant as agricultural produce, except for scrap sales as incidental (for example, trees that are cultivated for their fruit and their timber); and (c) annual crops (for example, corn and wheat).

5B. When bearer plants are no longer used for the production of produce, they may be cut down and sold as scrap, for example, for use as firewood. These incidental scrap sales do not prevent the plant from satisfying the definition of bearer plant.

5C. Produce in development from a bearer plant is a biological asset.

Agricultural activity comprises a range of activities, for example, livestock raising, forestry, annual or constant harvesting, cultivation of orchards and plantations, floriculture, and aquaculture (including fish farming). Certain common characteristics exist within this diversity:
(a) capacity to change. Living animals and plants are capable of biological transformations; (b) management of change. Management facilitates the biological transformation, promoting, or at least stabilizing, the conditions necessary for the process to occur (for example, nutrient levels, moisture, temperature, fertility, light). It is such management that distinguishes agricultural activities from other activities. For example, harvesting from unmanaged sources, such as fishing in the ocean or deforestation, is not an agricultural activity; and (c) measurement of change. The change in quality (for example, genetic merit, density, ripening, fat level, protein content, and fiber resistance) or quantity (for example, offspring, weight, cubic meters, length and/or diameter of fiber, and the number of shoots) caused by biological transformation or harvest is measured and monitored as a routine function of management.
Biological transformation results from the following events:
(a) changes in assets through (i) growth (increase in quantity or improvement in quality of the animal or plant), (ii) degeneration (reduction in quantity or deterioration in quality of animal or plant) or (iii) procreation (additional generation of animals or plants); or (b) production of agricultural produce, such as latex, tea leaves, wool, milk.

General definitions
8. The following terms are used in this Pronouncement with specific meanings:
Carrying amount is the amount at which an asset is recognized in the balance sheet.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. (See Technical Pronouncement CPC 46 – Fair Value Measurement). Government grant is defined in Technical Pronouncement CPC 07 – Government Grants and Assistance.

(Eliminated).

Recognition and measurement
10. An entity shall recognize a biological asset or agricultural produce when, and only when:
(a) the entity controls the asset as a result of past events; (b) it is probable that future economic benefits associated with the asset will flow to the entity; and (c) the fair value or cost of the asset can be measured reliably.

In agricultural activity, control may be evidenced, for example, by legal ownership of livestock and its branding at the time of acquisition, birth, or weaning. Future economic benefits are normally determined by measuring significant physical attributes.
The biological asset shall be measured at fair value less costs to sell at initial recognition and at the end of each reporting period, except for the cases described in item 30, where fair value cannot be measured reliably.
Agricultural produce harvested from the entity’s biological assets shall be measured at fair value less costs to sell at the point of harvest. The cost so determined shall be the cost at the time of application of Technical Pronouncement CPC 16 – Inventories, or other applicable Pronouncement.
(Eliminated).
The measurement of fair value of a biological asset or agricultural produce may be facilitated by grouping them, according to significant attributes recognized in the market in which prices are based, for example, by age or quality. The entity shall identify the attributes that correspond to the attributes used in the market as the basis for pricing.
Entities frequently make contracts to sell their biological assets or agricultural produce at a future date. Contracted prices are not necessarily relevant in measuring fair value because this reflects current market conditions in which buyers and sellers participating in the market would conduct the transaction. As a consequence, the fair value of a biological asset or agricultural produce shall not be adjusted by the existence of a contract. In some cases, a contract for the sale of a biological asset or agricultural produce may be an onerous contract, as defined in Technical Pronouncement CPC 25 – Provisions, Contingent Liabilities and Contingent Assets, which is applicable to onerous contracts.

17-21. (Eliminated).

The entity shall not include in the cash flow estimate any expectations of financing of assets or restoration of the biological asset after harvest (for example, the cost of replanting trees in a plantation after harvest).
(Eliminated).
Costs may, at times, approximate fair value, particularly when:
(a) a small biological transformation has occurred since initial recognition (for example, seedlings planted in the period immediately preceding the closing of the financial statements or newly acquired livestock); or (b) the impact of the biological asset’s transformation on the price is not expected to be material (for example, for the initial growth of a pine plantation whose production cycle is 30 years).
Biological assets are often planted on land (for example, timber trees). There may not exist a separate market for such assets, but there may exist a market for the combination of them, that is, for the biological assets, bare land, and improved land, as a set. The entity may use information about combined assets to measure the fair value of the biological assets. For example, the fair value of bare land and improved land may be deducted from the fair value of the combined assets, to obtain the fair value of the biological asset.

Gains and losses
26. The gain or loss arising from a change in fair value less costs to sell of a biological asset recognized from initial recognition until the end of each period shall be included in profit or loss for the period in which it arises.

A loss may arise on initial recognition of a biological asset because selling expenses are deducted in determining fair value. A gain may arise on initial recognition of a biological asset, such as when a calf is born.
The gain or loss arising on initial recognition of agricultural produce at fair value less costs to sell shall be included in profit or loss for the period in which it occurs.
The gain or loss may arise on initial recognition of agricultural produce as a result of harvest.

Inability to measure fair value reliably
30. There is a presumption that fair value of biological assets can be measured reliably. However, this presumption may be rebutted in the case of a biological asset for which quoted prices in an active market are not available and alternative reliable measures of fair value are not clearly available. In such situations, the biological asset shall be measured at cost less any accumulated depreciation and any accumulated impairment losses. When the fair value of such a biological asset becomes reliably measurable, the entity shall measure it at fair value less costs to sell. When a biological asset classified as non-current meets the criteria to be classified as held for sale (or included in a disposal group classified as held for sale), in accordance with Technical Pronouncement CPC 31 – Non-current Assets Held for Sale and Discontinued Operations, it is presumed that fair value can be measured reliably.

The presumption in item 30 may be rebutted only on initial recognition. An entity that has previously measured a biological asset at its fair value less costs to sell shall continue to measure it thus until its disposal.
In all cases, the entity shall measure agricultural produce at the point of harvest at its fair value less costs to sell. This Pronouncement assumes the presumption that the fair value of agricultural produce at the point of harvest can always be measured reliably.
In determining cost, accumulated depreciation, and accumulated impairment losses, the entity shall consider Technical Pronouncements CPC 16 – Inventories, CPC 27 – Property, Plant and Equipment, and CPC 01 – Impairment of Assets.

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Government grant
34. An unconditional government grant related to a biological asset measured at fair value less costs to sell shall be recognized in profit or loss when, and only when, it becomes receivable.

If a government grant related to a biological asset measured at fair value less costs to sell is conditional, including when it requires the entity not to engage in a specified agricultural activity, it shall be recognized in profit or loss when, and only when, the condition is met.
The terms and conditions of government grants vary. For example, a grant may require the agricultural entity to cultivate for five years in a specific location, and it must be returned in full if cultivation occurs for a shorter period. In this case, the grant cannot be recognized in profit or loss before five years have passed. However, if the contractual terms allow retention of the amount proportional to the passage of time, its accounting recognition must also be proportional.
If the government grant is related to a biological asset measured at cost less any accumulated depreciation or accumulated impairment losses (see item 30), Technical Pronouncement CPC 07 – Government Grants and Assistance shall be applied.
This Pronouncement requires different treatment from Technical Pronouncement CPC 07 if the government grant refers to a biological asset measured at fair value less estimated selling expenses or if the government grant requires the entity not to engage in a specific agricultural activity. Technical Pronouncement CPC 07 is only applied to government grants related to biological assets measured at cost less any accumulated depreciation and any accumulated impairment losses.

Disclosure
39. (Eliminated).

General
40. The entity shall disclose the gain or loss for the current period relating to the initial recognition of biological assets and agricultural produce, and also those arising from changes in fair value less costs to sell of biological assets.

The entity shall provide a description of each group of biological assets.
The disclosure required by item 41 may be in narrative or quantitative form.
The entity is encouraged to provide a description of the quantity of each group of biological assets.

SECURITIES AND EXCHANGE COMMISSION (CVM)
Rua Sete de Setembro, 111/2-5th and 23-34th Floors, Centro, Rio de Janeiro/RJ – CEP: 20050-901 – Brazil - Tel.: (21) 3554-8686 Rua Cincinato Braga, 340/2nd, 3rd and 4th Floors, Bela Vista, São Paulo/ SP – CEP: 01333-010 – Brazil - Tel.: (11) 2146-2000 SCN Q.02 – Bl. A – Ed. Corporate Financial Center, S.404/4th Floor, Brasília/DF – CEP: 70712-900 – Brazil - Tel.: (61) 3327-2030/2031 www.gov.br/cvm

CVM RESOLUTION NO. 74, OF MARCH 22, 2022

biologicals, distinguishing between consumables and production or between mature and immature, as appropriate. For example, the entity may disclose the total of biological assets that can be consumed and those available for production by groups. The entity may, in addition, divide that total between mature and immature assets. These distinctions may be useful in determining the influence of time on future cash flows. The entity must disclose the basis for making such distinctions.

Consumable biological assets are those that can be harvested as agricultural produce or sold as biological assets. Examples of consumable biological assets are herds of animals kept for meat production, herds kept for sale, fish production, corn and wheat crops, fruit-bearing plant produce, and trees for timber production. Production biological assets are the other types, such as: herds of animals for milk production; fruit trees, from which the fruit is harvested. Production biological assets (fruit-bearing plants) are not agricultural produce; they are kept to produce products.
Biological assets may be classified as mature or immature. Mature assets are those that have reached the condition to be harvested (consumable biological assets) or are fit to sustain regular harvests (production biological assets).
Financial statements must disclose, if this has not been done in any other way:
(a) the nature of activities involving each group of biological assets; and (b) non-financial measurements of physical quantities:
(i) of each group of biological assets at the end of the period; and (ii) of agricultural production during the period.

47-48. (Eliminated).

The entity must disclose:
(a) the existence and total of biological assets whose legal ownership is restricted, and the amount thereof given as collateral for liabilities; (b) the amount of commitments related to the development or acquisition of biological assets; and (c) the financial risk management strategies related to agricultural activity.
The entity must present a reconciliation of changes in the carrying amount of biological assets between the beginning and the end of the current period. The reconciliation includes:
(a) gain or loss arising from the change in fair value less costs to sell; (b) increases due to purchases; (c) reductions attributable to sales and to biological assets classified as held for sale or included in a group of assets held for that purpose, in accordance with Technical Pronouncement CPC 31 – Non-Current Asset Held for Sale and Discontinued Operations; (d) reductions due to harvests; (e) increase resulting from business combinations; (f) net exchange differences arising from the translation of financial statements into another presentation currency and, also, from the conversion of foreign currency transactions

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into the entity's presentation currency; and
(g) other changes.

The fair value less costs to sell of a biological asset may change due to physical changes and also price changes in the market. Separate disclosures are useful to assess the performance of the current period and for future projections, particularly when there is a production cycle comprising a period longer than one year. In such cases, the entity is encouraged to disclose, by group or otherwise, the total change in fair value less costs to sell, included in profit or loss, relating to physical changes and price changes in the market. Generally, this information is not as useful when the production cycle is less than one year (for example, when raising chickens or growing cereals).
Biological transformation results in several physical changes – growth, degeneration, production, and procreation, each of which can be observed and measured. Each of these physical changes has a direct relationship with future economic benefits. The change in the fair value of a biological asset due to harvest is also a physical change.
Agricultural activity is often exposed to climatic risks, disease risks, and other natural risks. If an event occurs and gives rise to a material item of income or expense, the nature and total must be disclosed in accordance with Technical Pronouncement CPC 26 – Presentation of Financial Statements. Examples of such events include outbreaks of viral diseases, floods, drought, frost, and insect pests.

Additional disclosure for biological asset whose fair value cannot be measured reliably

If the entity measures biological assets at cost, less any accumulated depreciation and accumulated impairment loss (see item 30), at the end of the period it must disclose:
(a) a description of the biological assets;
(b) an explanation of the reason why fair value cannot be measured reliably; (c) if possible, a range of estimates within which there is a high probability of finding the fair value; (d) the depreciation method used; (e) the useful life or depreciation rate used; and (f) the gross total and accumulated depreciation (plus accumulated impairment loss) at the beginning and at the end of the period.
If during the current period the entity measures biological assets at cost less accumulated depreciation and impairment loss (see item 30), it must disclose any gain or loss recognized on the sale of such biological assets, and the reconciliation required by item 50 must show the total related to such assets, separately. Additionally, the reconciliation must contain the following amounts, included in profit or loss and arising from those biological assets:
(a) impairment losses;
(b) reversal of impairment losses; and
(c) depreciation.

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If the fair value of biological assets, previously measured at cost, less any accumulated depreciation and accumulated impairment loss, becomes reliably measurable during the current period, the entity must disclose:
(a) a description of the biological assets;
(b) an explanation of the reason why the fair value measurement became reliably measurable; and (c) the effect of the change.

Government grants

The entity must make the following disclosures:
(a) the nature and extent of government grants recognized in the financial statements; (b) unfulfilled conditions and other contingencies associated with the government grant; and (c) significant expected reductions in the level of government grants.

58-62. (Eliminated).

63. In the period in which the relevant changes to fruit-bearing plants are applied for the first time, the entity does not need to disclose the quantitative information required by item 28(f) of CPC 23 for the current period. However, the entity must present the quantitative information required by item 28(f) of CPC 23 for each prior period presented.

65. CPC Revision 19, approved by the CPC on October 1, 2021, amended item 22. The effective date of this Revision must be established by the regulators approving it, and, for full compliance with international accounting standards, the entity must apply this amendment for annual periods beginning on or after January 1, 2022.

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Appendix – Illustrative Examples
This Appendix accompanies, but does not form part of the Pronouncement. Example 1 illustrates how the disclosures requested in the Pronouncement can be used by a dairy farm. This Pronouncement encourages the separation of the change in fair value less costs to sell of biological assets between physical changes and price changes. The separation is reflected in Example 1. Example 2 illustrates how to separate physical and price changes. The financial statement in Example 1 is not in compliance with all the disclosure and presentation requirements of all CPC Pronouncements. Therefore, changes may be appropriate.

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Example 1

XYZ Ltd.
Balance Sheet
Notes December 31, X1 December 31, X0
ASSETS
Current assets
Cash
Accounts receivable and other receivables
Inventories
Total current assets
Non-current assets
Fixed assets
Dairy herd – immaturea
Dairy herd – maturea
Subtotal – biological assets
Equipment (net)
Total non-current assets
Total assets
EQUITY AND LIABILITIES
Current liabilities
Suppliers and other payables
Total current liabilities
Equity
Paid-in capital
Reserves
Total equity
Total equity and liabilities
(3)
10,000
88,000
82,950
180,950
52,060
372,990
425,050
1,462,650
1,887,700
2,068,650
165,822
165,822
1,000,000
902,828
1,902,828
2,068,650
10,000
65,000
70,650
145,650
47,730
411,840
459,570
1,409,800
1,869,370
2,015,020
150,020
150,020
1,000,000
865,000
1,865,000
2,015,020

(a) The entity is encouraged, but not required, to provide a quantitative description of each group of biological assets, distinguishing between assets for consumption and for production or between mature and immature assets, as appropriate. The entity must disclose the basis for defining such distinctions.

XYZ Ltd.
Statement of Profit or Loss *
Notes Year ended 12/31/20X1
Value of milk produced sold
Gain arising from change in fair value less estimated costs to sell of the dairy herd for production Consumed materials Labor Depreciation Other costs Operating profit Income tax Profit for the period (3) 518,240 39,930 558,170 (137,523) (127,283) (15,250) (197,092) (477,148) 81,022 (43,194) 37,828

(*) This Statement of Profit or Loss classifies expenses by nature, as permitted by Technical Pronouncement CPC 26 – Presentation of Financial Statements, which determines that, if the statement does not have this format, its expenses must be arranged thus in the notes. Technical Pronouncement CPC 26 encourages the presentation of an analysis of expenses in the Statement of Profit or Loss.

Statement of Changes in Equity

XYZ Ltd.
Ended December 31, 20X1

Capital
Retained Earnings
Total

Initial balance January 1, 20X1
1,000,000
865,000
1,865,000

Profit for the period
37,828
37,828

Final balance December 31, 20X1
1,000,000
902,828
1,902,828

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Statement of Cash Flows*

XYZ Ltd.

Cash flow from operating activities
Receipts from milk sales
Receipts from herd sales
Payments to suppliers and employees
Payment for herd purchases
Payment of income taxes
Net cash from operations
Cash flow from investing activities
Acquisition of fixed assets
Net cash from investing activities
Net increase in cash
Cash at beginning of period
Cash at end of period

Year ended
12/31/20X1
498,027
97,913
(460,831)
(23,815)
111,294
(43,194)
68,100
(68,100)
(68,100)
0
10,000
10,000

(*) This Statement of Cash Flows reports cash from operations using the direct method.

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Notes

1 Main activities and operations
The XYZ Ltd. company develops the activity of milk production for supply to several clients. On December 31, 20X1, the company maintained 419 head of dairy cows (mature assets) and 137 calves for future milk production (immature assets). The company produced 157,584 kg of milk at fair value less costs to sell of $518,240 (which was determined at the time of milk extraction) in the fiscal year ended on December 31, 20X1.

2 Accounting policies
Dairy herd
The herds are measured at fair value less costs to sell. Fair value is determined based on the market price of assets of similar age, breed, and genetic qualities. Milk is initially measured at fair value less costs to sell at the time of extraction and based on the local market price.

3 Biological assets
Reconciliation of the recorded total of the dairy herd

Recorded total on January 1, 20X1
Increase due to purchases
Gains arising from changes in fair value less costs to sell attributable to physical changes* Gain arising from change in fair value less costs to sell attributable to price changes* Reduction due to sales Recorded total on December 31, 20X1

20X1
459,570
26,250
15,350
24,580
(100,700)
425,050

4 Strategic management of financial risks
The company is exposed to the financial risks inherent in the price change of milk. The management does not foresee a significant decline in the price of milk in the near future and, therefore, has not contracted any derivatives or other forms of protection for the risks of decline in said prices. The company reviews its expectations regarding the future price of milk regularly by assessing the need to manage financial risks.

(*) The separation of the increase in fair value less the estimated costs to sell at the time of sale, between the part attributable to physical changes and the part attributable to price changes, is not mandatory, but is encouraged.

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Example 2 - Physical change and price change
The following example illustrates how to separate physical and price changes, which is encouraged by the Pronouncement.

There was a herd of 10 units aged 2 years on January 1, 20X1. An animal aged 2.5 years was purchased on July 1, 20X1 for $108 and on that same date another was born. No animal was sold or made available for sale during the period. The unit fair values less costs to sell are as follows:

Animals aged 2 years on January 1, 20X1
Animal born on July 1, 20X1
Animal aged 2.5 years on July 1, 20X1
Animal born during the year, on December 31, 20X1 Animal aged 0.5 years, on December 31, 20X1 Animal aged 2 years on December 31, 20X1 Animal aged 2.5 years on December 31, 20X1 Old animals aged 3 years on December 31, 20X1

Fair value less costs to sell of the herd on January 1, 20X1 (10 x 100) Purchase on July 1, 20X1 (1 x 108) Increase in fair value less costs to sell due to price change:
10 × (105 – 100)
1 × (111 – 108)
1 × (72 – 70)
Increase in fair value less costs to sell due to physical change:
10 × (120 – 105)
1 × (120 – 111)
1 × (80 – 72)
1 × 70
Fair value less costs to sell of the herd on December 31, 20X1 11 × 120 1 × 80

100
70
108
72
80
105
111
120
50
3
2
150
9
8
70
1,320
80
1,000
108
55
237
1,400

Lineage: No known changes