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.Read More
Farm Management Software Blog
Learn new farm management and marketing skills and network with other producers from around the country at the 2019 Farm Futures Business Summit
What practices should you change to improve your business? What habits should you break? Here’s an opportunity to learn how to make the necessary changes to stay on top of your business goals. You’ll get ideas that you can’t wait to implement – just one idea you get from this conference can pay you back in business benefits!
Over the course of two intense days (with some entertainment!) we’ll gather together for a series of keynotes, panel discussions and interactive power sessions that will make farm management come to life. Mingle with experts from across the country as they offer advice and answer questions.
We’ll give you solid ideas on everything from high-level grain marketing to the key business practices that will help you make more money in 2019. Plus, you’ll be networking with some of the best farmers on the planet.
The 2019 Farm Futures Business Summit takes place Jan. 24-25, 2019 at the Coralville Marriott Conference Center and Hotel just outside of Iowa City, Iowa. This event promises to help you think outside the box as you manage the ever-increasing complexity of today’s farm operations. FBS Systems is one of the sponsors and will host a display throughout the conference.
For more information or to register click here.Read More
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.
Over the next few blog posts we’ll attempt to answer these questions:
- What do we do that’s unique?
- Who do we work for?
- What are the current technical tools of the trade?
- How we can support and leverage the Standards?
- What are the challenges to adoption?
- What are the opportunities for agricultural producers?
What We Do That’s Unique
FBS's mission statement is Integrated Information Systems (what we do) for Agriculture’s Top Managers (who we work for).
Let’s begin with who we “work for.” FBS users are among the most progressive, demanding and complex farming operations in North America. You'll find examples of them nearly every month in the "FBS Users In the News" stories. These operations are managing diverse enterprises, and all are constantly growing in scale and accounting sophistication. Many are nationally-recognized leaders in their fields and some have be selected for awards such as Farm Journal Top Producer of the Year.
What’s the big deal about integration?
If you’re like many growing, progressive producers your scale and complexity are working against you because this vital information is housed in separate “silos” consisting of unconnected accounting and production software supplemented by countless spreadsheets.
These information silos exist to accomplish specific information goals:
- Cash accounting for taxes.
- Accrual accounting to accurately measure true profitability.
- Production records for insurance compliance and to evaluate best management practices.
- Inventory control to verify what’s available to sell and what’s been used.
- Cost/management accounting to determine your farm’s internal costs and margins.
- Budgeting to financially project your operation into the future.
- Benchmarking to standardize and compare your performance with industry leaders.
- And ownership accounting to automate and consolidate your complex business relationships.
Although each of these information silos share the same source data they appear to be incompatible in their timing and precision. For example:
Cash and accrual accounting rely on different transactions in the same time period
Crop and livestock production cycles rarely correspond to calendar years.
- Financial accrual adjustments don't tie out to field and group production/management level detail.
Next time we’ll look at the current “technical tools of the trade” that address these problems. Meanwhile we invite you to watch our introductory "Farm Software Success Through FBS" video.
In prior installments in this series, we covered the two key questions in the Growth Path Accounting Decision Tree. This month we continue tracing the accounting results from these decisions.
Tags: cost accounting, accrual accounting, agricultural managerial accounting, ag software, farm accounting, enterprise analysis, Farm Financial Standards, agricultural inventories, cost analysis, integrated farm software, integrated production and financial software
Tags: farm management accounting, cost accounting, farm financial statements, accrual accounting, farm financial reporting, agricultural managerial accounting, farm accounting, agricultural inventories, cost analysis, inventory valuation
However, we believe most of the “goodies” envisioned in the article can be under your tree by 12/25 rather than 2025.
Here’s the real state-of-the-art for integrated farm records:
- Connecting production data directly with accounting software. FBS already includes “tight and right” integration between production activities/inventories and accounting based on common definitions that simplify input and produce comprehensive reports.
- Dozens of data silos. Last month we touched on the 50 or so sources of data we can import from, including precision farming technology, feed mills, packers and Conservis apps. Perhaps these diverse products will be more standardized in the years ahead through initiatives from organizations like AgGateway and informal market forces.
- Converting production to accrual. E.CLIPSE managerial accounting automatically converts activities to costs that flow from raw materials through work in process through finished goods on the balance sheet to cost of goods sold on the income statements.
- More accurate equipment and labor records. E.CLIPSE also performs activity-based-costing to monitor the resources consumed through each phase of production and match those costs with hours, acres, miles, bushels, pounds and head.
- Electronic invoices. Even though there’s little standardization yet in agribusiness FBS can already import invoices and sales receipts from a wide range of formats and transfer the management detail (quantities, groups, fields, products) as well as the dollars into the farm’s central accounting and management information system.
- Smart data/measuring what you manage. Rather than viewing accounting as a “rear-view” of a business used to determine historical “cost of production” for raised products (which are often affected by external factors like weather and disease), activity-based costing evaluates the efficiencies and margins of each responsibility center.
- Virtual CFO. Just as progressive, growing operations rely on internal specialization and outside consultants for production analysis they are also tapping into virtual CFOs and controllers who can remotely oversee the financial details of the business.
- Google Glass. OK. Unlike the other technologies, most of us will have to wait a few more months before we find this “toy” in our stockings.
The November 2013 issues of Farm Futures Magazine is packed with valuable tips for guiding you to the financial future of your farm.
Tags: managerial accounting, farm management accounting, accrual accounting, agricultural managerial accounting, Top Producer Magazine, Dick Wittman, farm financial standards council, Danny Klinefelter, Farm Futures Magazine, Lance Woodbury, integrated software
Life's been good…and easy…for most crop producers in the past seven years. Changing conditions, though, will require a new emphasis on proven farm management accounting principles aided by 21st Century technologies.
Two recent articles in the farm press validate how far farm management technology has come, yet how far it has yet to progress to make a serious business impact.
Tags: managerial accounting, farm management accounting, cost accounting, farm financial statements, accrual accounting, farm financial reporting, agricultural managerial accounting, farm inventories, farm records, farm software, ag software, agricultural decision support, business processes, agricultural software, farm accounting, enterprise analysis, precision farming
"The next generation of agricultural managers are asking how the industry can enable seamless data exchange between machines and Farm Management Information Systems. The costs of exchanging data are high due to the lack of common implementation guidelines, data transfer protocols, message standards, and standard reference data. Producers report that it is difficult or nearly impossible to move data from one system to another. To do so almost always requires data reentry, manual data transformation, and/or specialists to manage data."
Tags: farm management accounting, agricultural managerial accounting, farm inventories, ag software, agricultural decision support, agricultural software, agricultural inventories, agricultural compliance, farm