{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/325/905/#05-overview-and-background","source":"FASB Accounting Standards Codification, Basic View","usage":"Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.","topic":"325","topic_title":"Investments—Other","subtopic":"325-905","subtopic_title":"Agriculture","section":{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"325-905-05-1","para":"05-1","html":"<div class=\"asc-body\"><div class=\"norm-text\">This Subtopic addresses all other investments for entities in the agricultural industry. The guidance for accounting by different entities in the agricultural industry is presented in the following two Subsections:<ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\">Cooperatives</div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\">Cooperatives—<a href=\"/glossary/p/#patrons\" class=\"term\" title=\"Any individual, trust, estate, partnership, corporation, or agricultural cooperative with or for whom a cooperative does business on a cooperative basis, whether a member of an agricultural cooperative or nonmember of an agricultural cooperative.\"><span>Patrons</span></a>.</div></li></ol></div></div>","snippet":"This Subtopic addresses all other investments for entities in the agricultural industry. The guidance for accounting by different entities in the agricultural industry is presented in the following two Subsections:\n(a) C…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4e7eaa647ef51432fa1bdbd86c87a2ae85c0a517dc083a3620a34f24074ee2cb","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:56ceca8451c905cdd1a2c1985dd27e22bb5ec8b799a7963b2cad1292073693e5","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}},{"block":"Cooperatives","heading":null,"paragraphs":[{"citation":"325-905-05-2","para":"05-2","html":"<div class=\"asc-body\"><div class=\"norm-text\">The Cooperatives Subsections provide guidance for an <a href=\"/glossary/a/#agricultural-cooperative\" class=\"term\" title=\"The Agricultural Marketing Act of 1929 defines a cooperative association as any association in which farmers act together in processing, preparing for market, handling, and/or marketing the farm products of persons so engaged, and also means any association in which farmers act together in purchasing, testing, grading, processing, distributing, and/or furnishing farm supplies and/or farm business services. Provided, however, that such associations are operated for producers or purchasers and conform to one or both of the following requirements: No member of an agricultural cooperative association is allowed more than one vote because of the amount of stock or membership capital he may own therein. The association does not pay dividends on stock or membership capital in excess of 8 percent per year. In addition to meeting either of the requirements in this paragraph, the association shall not deal in farm products, farm supplies, and farm business services with or for nonmembers of an agricultural cooperative in an amount greater in value than the total amount of such business transacted by it with or for members. All business transacted by any cooperative association for or on behalf of the United States or any agency or instrumentality thereof shall be disregarded in determining the volume of member and nonmember business transacted by such association.\"><span>agricultural cooperative</span></a> if it holds investments in other cooperatives.</div></div>","snippet":"The Cooperatives Subsections provide guidance for an agricultural cooperative if it holds investments in other cooperatives.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:38319d9d1620c7718eb5ce98f4de9117d84610febd0634cb4b26d9ea63e34ce3","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5634039b5b0060a3b9f3c7c26d5b74c533efaa9453adf188a9a7c48da9d4b953","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}},{"block":"Cooperatives—Patrons","heading":null,"paragraphs":[{"citation":"325-905-05-3","para":"05-3","html":"<div class=\"asc-body\"><div class=\"norm-text\">The Cooperatives—<a href=\"/glossary/p/#patrons\" class=\"term\" title=\"Any individual, trust, estate, partnership, corporation, or agricultural cooperative with or for whom a cooperative does business on a cooperative basis, whether a member of an agricultural cooperative or nonmember of an agricultural cooperative.\"><span>Patrons</span></a> Subsections provide guidance for a patron's investments in cooperatives.</div></div>","snippet":"The Cooperatives—Patrons Subsections provide guidance for a patron's investments in cooperatives.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ee03be90efbdc53310606ec81e2d8c4a7826818a4fcfb215b475fca6248bd6a3","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}},{"citation":"325-905-05-4","para":"05-4","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_138F8B48-6E93-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Member patrons provide most of the capital required by <a href=\"/glossary/a/#agricultural-cooperative\" class=\"term\" title=\"The Agricultural Marketing Act of 1929 defines a cooperative association as any association in which farmers act together in processing, preparing for market, handling, and/or marketing the farm products of persons so engaged, and also means any association in which farmers act together in purchasing, testing, grading, processing, distributing, and/or furnishing farm supplies and/or farm business services. Provided, however, that such associations are operated for producers or purchasers and conform to one or both of the following requirements: No member of an agricultural cooperative association is allowed more than one vote because of the amount of stock or membership capital he may own therein. The association does not pay dividends on stock or membership capital in excess of 8 percent per year. In addition to meeting either of the requirements in this paragraph, the association shall not deal in farm products, farm supplies, and farm business services with or for nonmembers of an agricultural cooperative in an amount greater in value than the total amount of such business transacted by it with or for members. All business transacted by any cooperative association for or on behalf of the United States or any agency or instrumentality thereof shall be disregarded in determining the volume of member and nonmember business transacted by such association.\"><span>agricultural cooperatives</span></a>. </span></span><span class=\"sfragment\" id=\"sfr_138F8D25-6E93-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\"> The capital usually represents long-term investments acquired through initial cash investments, <a href=\"/glossary/r/#retains\" class=\"term\" title=\"Amounts determined on a per-unit basis or as a percentage of patronage earnings that are withheld by cooperatives from distributions and allocated to patrons' capital accounts.\"><span>retains</span></a>, or noncash <a href=\"/glossary/p/#patronage\" class=\"term\" title=\"The amount of business done with a cooperative by one of its patrons. Patronage is measured by either the quantity or value of commodities received from patrons by a marketing cooperative and the quantity or value of the goods and services sold to patrons by a supply cooperative.\"><span>patronage</span></a> allocations. </span></span><span class=\"sfragment\" id=\"sfr_138F8EBE-6E93-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Voting rights for those investments are usually based on one-member-one-vote or limited weighted voting rather than on the number or amount of securities or other evidence of equity ownership held. </span></span><span class=\"sfragment\" id=\"sfr_138F902D-6E93-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">The significance of investments by patrons results primarily from the purchasing or marketing rights and participation in the operating earnings. </span></span><span class=\"sfragment\" id=\"sfr_138F91BB-6E93-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">The investments are made primarily to obtain an economical source of supply or marketing services and not on the expectation of a return on investment. </span></span><span class=\"sfragment\" id=\"sfr_138F9335-6E93-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Investments in cooperatives are not equity securities and usually are not readily marketable, and transfer or sale, other than back to the issuing cooperative, is usually restricted or prohibited. </span></span><span class=\"sfragment\" id=\"sfr_138F94AA-6E93-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\"> As such, the operations of cooperatives have many of the attributes of corporate joint ventures or partnerships. </span></span></div></div>","snippet":"Member patrons provide most of the capital required by agricultural cooperatives. The capital usually represents long-term investments acquired through initial cash investments, retains, or noncash patronage allocations.…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9aab67114c08209c7eb2ed3ff1baf81002d227682cc80f8056561f398cebf077","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:983908dc18761f77c01e4f88e5fc9782f1449bf847d170405e240122db163ca1","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:88c1f262187b334449b9f8e9617aea2623cf6118f632d04e0a92b8851003142b","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:88c1f262187b334449b9f8e9617aea2623cf6118f632d04e0a92b8851003142b","downloaded_from":"2026-09-09T23:45:04.068Z","last_downloaded_at":"2026-09-09T23:45:04.068Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477998","source_sha256":"0d5d9876381a38179abf8e28c48282eedfa32a945ccc1b4b31a7a7aa58b40b50"}}