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Forest as a biological asset - An accounting and tax perspective in the Czech Republic

Author

Listed:
  • Petra Hlaváčková

    (Department of Forest and Wood Product Economics and Policy, Faculty of Forestry and Wood Technology, Mendel University in Brno, Brno, Czech Republic)

  • Jitka Fialová

    (Department of Landscape Management, Faculty of Forestry and Wood Technology, Mendel University in Brno, Brno, Czech Republic)

  • Jiří Schneider

    (Department of Environmental Science and Natural Resources, Faculty of Regional Development and International Studies, Mendel University in Brno, Brno, Czech Republic)

Abstract

This paper analyses the accounting and tax treatment of forests as biological assets in the Czech Republic under Act No. 563/1991 Coll., on Accounting, and its implementing regulations. It compares national approaches with the International Financial Reporting Standards (IFRS), focusing on the International Accounting Standard IAS 41 - Agriculture. A comparative-analytical method was used to identify key differences in classification, valuation, and reporting practices. Czech legislation values forests at historical cost and classifies them as non-depreciable land, whereas IFRS requires fair value measurement, capturing biological transformation and the economic potential of forest ecosystems. The findings show that while the Czech framework ensures legal clarity and tax alignment, it lacks integration with environmental accounting frameworks such as the United Nations System of Integrated Environmental Economic Accounts (SEEA) and does not reflect ecosystem services or ESG (environmental, social, governance) reporting needs. In contrast, IFRS provides a dynamic representation of forest assets, supporting transparency and comparability in international contexts. The study contributes to the ongoing harmonisation debate by offering recommendations to improve the alignment of Czech accounting with international standards, thus supporting sustainable forest management and enhancing investment credibility. Its originality lies in combining legislative analysis with international practice review, highlighting the gap between ecological value and financial reporting in forestry.

Suggested Citation

  • Petra Hlaváčková & Jitka Fialová & Jiří Schneider, 2025. "Forest as a biological asset - An accounting and tax perspective in the Czech Republic," Journal of Forest Science, Czech Academy of Agricultural Sciences, vol. 71(7), pages 336-346.
    • Handle: RePEc:caa:jnljfs:v:71:y:2025:i:7:id:31-2025-jfs
    DOI: 10.17221/31/2025-JFS
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    References listed on IDEAS

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    1. Marini Govigli, V. & Bruzzese, S., 2023. "Assessing the emotional and spiritual dimension of forests: A review of existing participatory methods," Forest Policy and Economics, Elsevier, vol. 153(C).
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