The following is a summary of a presentation entitled "Financial and Management Accounting Software--Developments, Implementation Challenges, and Integration Issues" made in July 2018 to the Farm Financial Standards Council Annual Conference in Champaign, Illinois.
Advanced Technical "Tools of the Trade"
What benefits do ag-specific accounting programs based on the Farm Financial Standards have over "main street" accounting software? Last month we reviewed some capabilities of basic "Farm Accounting 101" programs. In this issue we'll examine even more advanced technologies.
Integration: the "Holy Grail"
For many years ag software developers have searched for the "holy grail" of integration of production and financial data. What's the big deal? Here are just a few potential benefits:
- Save time by eliminating duplicate data entry.
- Trap errors by reconciling purchases, sales, consumption and production.
- Financially evaluate farming practices and activities.
- Real-time updates of inventories, margins and break-even costs.
- Maintain a single management platform that simultaneously monitors and controls these 8 information "silos."
This integrated worldview has already been widely adopted in manufacturing, distribution and retail industries through ERP(Enterprise Resource Planning) software. The German company SAP has been the world market leader. Most ERP systems require a high degree of customization and implementation costs and none come "off the shelf" ready for conventional agricultural producers.
Here's a link to a story in Successful Farming last year on one farm's efforts to implement an ERP system.
Next time we’ll look FBS's ERP data model described at Farm Financial Standards Council meeting. Meanwhile we invite you to watch our introductory "Farm Software Success Through FBS" video which helps you determine if you are ready for your own ERP.