There are few things more important in accounting than accuracy, especially when managing your farm and making strategic decisions relies upon those numbers. For that reason, the Generally Accepted Accounting Principles (GAAP) were established to standardize accounting methods for reporting inventory and submitting financial statements. 

Get excited for this year’s BOOST/23 Agriculture Software Success Summit with FBS Systems! This November, join us for an exclusive event that highlights agricultural management accounting and technology integrations that can transform the way you run your farm.

For modern farmers, agriculture technology has become an integral part of business. However, when most people think of “ag tech,” farm accounting solutions might be one of the last things that they think of.

Margin analysis, or marginal analysis, is the practice of examining the cost of a good or service versus the potential benefit of that good or service. Even if you hadn’t heard of the term before, odds are you’ve made this comparison for yourself countless times as a farm owner or operator. However, there’s a danger to basing margin analyses on general assumptions—which is why it’s important to utilize activity-based costing.

 

Nobody said managing a farm would be easy. From managing actual crops to tracking financials for farm profitability, modern farming can be incredibly difficult. Financial management choices such as adding or not adding new farming technology, sourcing crop seed, purchasing fertilizer, or hiring additional labor can have an enormous impact on farm profit and loss ratios.

Farm management covers a broad scope of factors. From inventory management to long-term production cycles, having the right tools in place for farmers, farm managers, and agricultural accountants helps keep things running smoothly. Of course, management accounting is helpful for organization, but leveraging ERP software to complement advanced agricultural accounting strategies is an excellent way to help minimize expenses and maximize profits. 

For a long time, in the agricultural sector, technology, beyond farm equipment, was relegated to the back office. Thankfully, farms don’t operate that way anymore. In fact, most have learned to leverage ag tech to assist in improving productivity and profitability.

When it comes to farm oversight, understanding where you are, in terms of financial information and accounting is vital. Growth Path Accounting starts with asking where you are now and what your information goals are. Growth Path Accounting can be narrowed down to three objectives:

• Leveraging the technology available to you through software and applications
• Learning advanced accounting skills at your own pace  
• Preparing you and your operation for future expansion to integrated farm records
  
  

To get there, you first need to understand Growth Path accounting and all of its separate parts. That informs not just your understanding of where you are and which accounting method you’re currently using, but also where you’d like to be and the advantages of the other accounting methods available to you.

Every February, farmers and ranchers from across the country gather at the National Farm Machinery Show which showcases cutting edge farm equipment and machinery to improve farm performance and help you get the job done. What you will rarely find at a show like that, though it’s equally important, is farm accounting software. Both machinery and ERP Software for the farm  have the power to pave the way for farm growth and success. Understanding how to leverage farm accounting to ensure efficiency and accuracy may just come down to how you use the tools you have at your disposal.

Farm Futures recently published a story by Mike Wilson reporting on the partnership between Conservis and Rabo AgriFinance that answers the question, "What happens when a top ag financier teams up with a leading digital farm management business?"

(Part 6)

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.

(Part 5) 

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.

"What is the value of this kind of information if I can get it delivered to me in a more integrated fashion?"

 

Learn new farm management and marketing skills and network with other producers from around the country at the 2019 Farm Futures Business Summit

For more information or to register click here.

"If you’re struggling with a main street accounting program today, it might be time to reach out to a higher-level, farm-focused program for your business."  So says Editor Willie Vogt in the April 2017 Farm Industry News cover story, "Raising Your Accounting Game."