The farm accounting practice in India is said to be in its infant stage. This paper seeks to
examine the rationale for a full-fledged farm accounting practice in the country. Literature
reveals a strong relationship between the degrees of commercialization with that of the
adoption of accounting practices. Therefore, the study attempts to examine the commercial
traits in Indian farms, which genuinely envisage such practices in the sector. Thereafter, the
existing practices of accounting in India are discussed by underscoring the measurement
and valuation techniques of different farm account heads. Lastly, the study tries to draw
attention to certain lacunas in the existing system. These are drawn using the authors’ own
observations, supported by past research. As outcomes of the study, a considerable
commercial appeal is seen in the Indian farm sector. Certain farm accounts heads and their
respective treatments are provided to explore the existing system of farm accounting in the
country. The drawbacks of present practice are found in terms of recognition, measurement
and presentation of financial data.