Browsing by Author "Baptista, Carl"

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    An assessment of variation within IAS 41 compliant methodology used in South Africa to estimate the value of pulpwood plantations
    (Stellenbosch : Stellenbosch University, 2016-03) Baptista, Carl; Ham, Cori; Howard, Michael; Stellenbosch University. Faculty of AgriSciences. Dept. of Forest and Wood Science.
    ENGLISH ABSTRACT: This study sought to assess the possible variations within International Accounting Standard (IAS) 41 compliant valuation methodologies used within South Africa to estimate the value of pulpwood plantations. IAS 41 compliant valuation models were collected from valuation consultants and companies active within the South African forestry sector. Along with the collection of models, model input parameters and methods for the determination of input parameters were retrieved. Models were amended to accept default standardised inputs. These default inputs consisted of case study plantation data sourced from an unnamed plantation in South Africa. Valuations were calculated for this case study plantation using the various models, and used to assess the possible variances between model valuation outputs. In this way the variances derived from the different model mechanisms could be compared to each other. A sensitivity analysis was then performed in order to understand the effect of each parameter upon the valuation output of each model. This study indicated that there are significant differences between valuation outputs as calculated from a range of IAS 41 compliant valuation models. The collected parameters and parameter classification data also highlighted that certain parameters, age class and growth rate in particular, were being calculated or determined in different ways by users resulting in further sources of potential variance in the calculated values produced by the models. The study concluded with an evaluation of each of the six unique models in the study. Two main aspects were identified that need to be addressed namely: (i) The standardisation of a model to be used for all valuation purposes; (ii) The provision of rigid guidelines regarding the standardisation of model input parameters.