How should a biological asset be measured at the end of a reporting period?

A biological asset should be measured at fair value less costs to sell at the end of a reporting period because this measurement approach provides a more accurate reflection of the asset's current market value. Biological assets, such as plants and animals, are living assets that can change in value over time due to growth, decay, and market conditions. By using fair value, the financial statements present a more relevant and timely representation of the asset's worth.

Fair value measurement considers the market conditions and potential selling price of the biological asset at the reporting date, while deducting costs associated with selling the asset provides a clearer picture of its net realizable value. This method aligns with the accounting standards that prioritize current market information over historical cost, ensuring that stakeholders have the most useful information for decision-making.

Using fair value less costs to sell also recognizes the ongoing value creation from the biological asset, considering potential future economic benefits rather than just reflecting how much was initially paid for the asset, which might be outdated or misleading in the context of its current value.