The deemed cost method of valuation described in Section 7 of
the March 1993 agreement (see
BIM55410) should not be used where it
would not result in a reasonable estimate of cost, for example in
the case of pedigree stock.
The agreement published in IR232 authorises use of the
method only as regards cattle, sheep, pigs and harvested crops.
Other species of farm livestock are not covered. If, in a
particular case, the use of a similar method to arrive at a
reasonable estimate of cost for another species of farm livestock
is accepted, it should be made clear that agreement to the use of
the method for that species is for that case only and should not be
treated as creating a precedent for other cases. The method is not
appropriate to the valuation of thoroughbred horses (see
BIM55435).
