Accounting standard introduced for forest management
Accounting standard introduced for forest management
JAKARTA (JP): The draft of an accounting standard specially
designed for forest concessionaires has been introduced to
businessmen to supplement the general principles of accounting
which have been applied by the Association of Indonesian
Accountants (IAI).
During a public hearing introducing the draft here yesterday,
Minister of Forestry Djamaloedin Soeryohadikoesoemo said the
Special Accounting Standard for Forest Management (SASFM) was
designed to ensure that forest-concession holders manage their
forests in an ecologically responsible manner and to help the
ministry assess the company's financial condition and
obligations.
"The absence of a standard accounting system in forest
management has resulted in a variety of methods to calculate a
company's economic rent. The government has also experienced
difficulty in assessing a company's fulfillment of its financial
and environmental obligations," Djamaloedin said.
According to him, a forest concessionaire's financial report
currently does not clearly show whether it has fulfilled various
obligations to the government, such as paying production and
reforestation fees, presenting an asset valuation report and an
environmental impact analysis.
According to the Director General of Forest Management
Hendarsun Suryasanusiputra, the draft of SASFM was formulated by
a joint team of the Ministry of Forestry, the IAI and the Faculty
of Economics at the University of Indonesia.
The team started its work in February last year and the draft
was presented to a steering committee in October.
"SASFM and two other adjoining principles, which are the
Guidelines for Financial Reporting and the Guideline for
Financial Control, are expected to be completed by the end of
this year," he said.
Improvement
Hendarsun said the public hearing was intended to collect
input for the draft's improvement.
"After the draft of SASFM has been passed and implemented, the
team can start working on the other two principles," he said.
Despite the implementation of SASFM in the near future, the
general principles of accounting will still be applied.
Under SASFM, forest concessionaire holders are required to
specify their activities and expenditures in implementing the
selective logging and planting system, the row logging and
planting conservation system, their forest conservation
activities, their plantation projects on vacant land and other
nature preservation efforts.
The company must also report its share equity in wood and non-
wood industries, the management of its wood-processing system and
the area of remaining virgin forest.
It must also disclose the remaining term of the concession,
heavy equipment used, the area planted in the current year and
the cumulative area already planted. The forest concessionaire
must also present a list of the company's managers and
shareholders, its transactions with parties with whom it has
special relationships and its efforts to conserve fauna, flora
and water. (10)