Browsing by Author "Talvensaari, Terhi"

The aims of this study were to update an accounting model suitable for profitability calculations in family forestry, to test the MELA-software for evaluating stand and bare land values and to test the presented accounting model with two family forest properties located in Päijät-Häme area. Owners of the case forest properties provided bookkeeping notes, tax information, timber sales details, felling information, an estimation of entrepreneurial work and the amount of wood products taken for private use from year 2013. Forest Management Association Päijät-Häme provided numerical forest plans including stand level information from properties as well as association-level average stumpage prices and unit costs from years 2012 and 2013 for MELA-software calculations. MELA-software was employed to calculate the values of stands and bare land. The accounting model for family forestry was updated according to the requirements of international accounting standards (IFRS/IAS) and the forest stand liquidity effects of amended Finnish forest act of 2014. Profit and loss statement and balance sheet were illustrated by presenting average results per hectare for the case forest properties. Total net values of the forest property, divided into stumpage value, bare land value and goodwill value, were placed as non-current assets on the balance sheet. The changes in goodwill and stumpage values were also taken into account in the profit and loss statement. Current assets of the balance sheet included only items, which will be realized in the near future, like sold but not yet felled trees or harvested round woods, which are waiting for the transport. Additionally the balance sheet was amended with short-term tax income liabilities. The profitability of private forest properties was analyzed by using relative profitability indicators, which were return on investment (ROI), return on equity (ROE) and return on assets (ROA). The case forest properties had different structures in business and growing stock and therefore the accounting model could describe interesting results, even though the analyzed fiscal period was only one year. The results of the study can be utilized in developing profitability information services for forestry, for example the Economy Doctor by Natural Resources Institute Finland.