New Website, Porkshop Speaker, 2011 User Conference, Best Practices for Ledger Accounts, Checkless Payments
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 FarmSMART                                                      June 2011 

In this Issue:

New Website

Porkshop Speaker

2011 User Conference

Best Practices for Ledger Accounts

Q&A:  Checkless Payments 

Visit our Website

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Greetings!  June Morning

It's June again, and there's plenty of green (and water) to go around here in the Midwest. 

"Green" was also on the minds of pork producers attending the PORK$HOPSeminar earlier this month.  We'll continue focusing on how all types of producers can keep more of their green at the annual FBS User Conference in Moline, Illinois, home of green farm machinery. 

We're continuing a series on "Best Practices" with tips on using Ledger Accounts and will tell you how to record payments without writing a check. 

Finally, we're providing links to some great Summer ag events around the country and webinars you can attend without leaving your desk.                                                              
                                                                                    SDG

PORK$HOP Speaker Asks "What Are You Getting Paid For?"  
Michael Swanson
Wells Fargo Economist Michael Swanson

According to PORK$HOP keynote speaker Michael Swanson, the choices are either "guessing the future" or "being a good operator." Since guessing the future is above the pay grade of even a Ph.D. economist like Swanson, the real returns come from "margin management" and "reading the blitzes." 

The June 7, 2011, seminar began with "Best Practices of FBS Pork Clients," then proceeded to the release of the Latta, Harris, Hanon & Penningroth Cost of Production Benchmarks for 2010 and projections for 2011.

John McNutt
John McNutt compares"real-life" production costs for all segments of pork production.

The application of cost benchmarks, market outlook and software practices occurred in the closing panel where David Ward, Commodity and Ingredient Hedging, Adam Hocker, Brenneman Pork and Kent Bang, Bank of the West, described the opportunities available to pork producers through sound margin management. 

Panel
Margin Management panel members Kent Bang, David Ward, Adam Hocker and moderator Mark Penningroth.

 More than sixty producers, lenders and consultants from seven states attended the nineteenth annual management conference sponsored by the CPA firm Latta, Harris, Hanon & Penningroth L.L.P.,DTN Progressive Farmer and FBS Systems, Inc.

PORK$HOP 2011 Overview

Thanks to everyone who particpated in PORK$HOP.2011.

See you next year!

 Click here to view the presentations from this year's seminar.

Don't "Miss the Boat" to the FBS 2011 User Conference

 

Celebration Belle

 

Please mark your calendars now for the premier management training/networking event of the year.  The annual FBS User Conference helps anyone using computers in agricultural to be more current, effective and profitable.  This year's conference will be held on  September 1-2 in the Stoney Creek Inn, Moline, Illinois and will feature:     

  • New users sharing how they are making the transition from traditional software to the FBS integrated system. 
  • Best practices from experienced FBS users. 
  • Cost of production benchmarks for crops and livestock. 
  • New product and version training
  • Breakout sessions for beginners, "power users" and professional service providers. 
  • A prime rib dinner cruise on the Mississippi River. 

Don't miss the boat!  Hold those dates and watch your mail and the FBS website for more information.

Apply "Best Practices" to Your Ledger Accounts

  Editor's noteThis article begins a new series on the "best practices" FBS users have developed to improve effectiveness, efficiency, internal control and compliance from their information system.  We'll also be covering a full range of best practices at the 2011 FBS Users Conference in September.  To contribute your best practices visit our blogsite. 

Is your chart of accounts a multi-lane, high-speed expressway or a dirt road riddled with pot holes and rabbit trails?  Following best practices with ledger accounts--the backbone of your accounting system-you can easily make data entry and reporting more efficient an effective. 

These are the critical areas: 

Completeness
Since FBS switched to Windows ten years ago, all software versions include the Farm Financial Standards chart of accounts.  (You can view this Chart by creating a new company within FBS and checking the Farm Financial Standards ledger accounts option under Quick Start.)  This five-digit numeric chart of accounts was developed by CPAs in response to guidelines provided by the National Pork Producers and Farm Financial Standards councils.  It not only encompasses most crop and livestock operations, but also includes the specialized "internal" accounts required to drive E.CLIPSE Managerial Accounting entries. 

Other ledger alternatives include the FBS three-digit "Standard" chart, "cloning" from another company or building a chart from scratch using any combination of up to six letters or numbers.  However, unless you're working with a trained accountant with FBS experience, it's much quicker and safer to begin with the FFSC chart, then modify to your needs.

  • Accounts that you know you'll never use (for example, "Bull Lease") can be deleted.  (When in doubt, don't delete!) 
  • Accounts that you may use in the future should be inactivated(un-check the Active box). 
  • New account tailored to your business should be inserted in the proper sections, which are pre-defined by Class (Income, Expense, Asset, Liability, Equity) and Heading Account (for example, "Production Labor" or "General and Administrative").
Market expense accounts
The Marketing Expense Section
  • Follow the pattern of similar accounts to determine the properType and Integration Type
  • A pre-built chart is also fully "de-bugged," requiring less support.

Remember that because FBS is a flexible, "multi-dimensional" system (Account x Division x Center x Group/Project x Product), a well-designed chart of accounts accounts generally doesn't require overwhelming complexity or continuing customization.  (That's handled through the other data fields and sub-modules, which we'll cover in future chapters.) 

Nevertheless, you may benefit by adding company-specific accounts under these circumstances:

  • Items you want to monitor on a per-unit basis with theLifeCycle Budget.  This includes crop sales by commodity (see example below) and specific feed, utilities and fuel accounts.
Actual-Budget Comparison
Unit-based comparisons at the ledger level.
  • Major loans that you want to display as line items on your balance sheet. 
  • Packer-specific sales, carcass and weight accounts you need to track in the Smart Feeder User-Defined Report or FarmSeRVey Dashboard.

But what if your FBS chart of accounts is still stuck in two-digit "FBFM" format?  Take advantage of the re-labeling function in FBS and simply add two or three zeros to your current accounts and you've instantly expanded your chart.  With a little more effort you can even switch a two or three-digit chart to the full FFSC version.  

Consistency

A well-designed chart of accounts, backed-up by farm-specific sub-modules should be intuitive for data entry staff.  The FFSC chart is split by descriptive Heading accounts that are organized around the typical sections of an income statement and balance sheet with Detail accounts in alphabetical order between each section. 

Here are a couple of tips to help your data entry staff and report users to identify the appropriate accounts. 

  • Account Descriptions can be up to forty characters long. 
  • User-defined 240-character "cue cards" can be attached to selected accounts.   (See Setup | User Defined Help to add.)

Again, never delete an account after it's been used; either inactivate it or inactivate and rename it using an alpha code if you need to re-use its number.

We've seen some innovative schemes for segregating internal management accounts from the external financial general ledger using alpha codes.  Also if an account is always automatically posted (as with packer traits) it should be at the end of the list so it doesn't get in the way of manual posting.

Carcass Trait Accounts
An alpha prefix can identify management accounts.

Next month we will look at some best practices for Cost and Profit Centers.

Visited Our New Website Yet?
FBS Systems Home PageThere's a wealth of timely information waiting your inspection at our new website. Check them out now by clicking on the image or any of the links below.

To start your tour, click on the image above. 

Leave comments or suggestions regarding our website.

Q&A of the Month--"Checkless" Payments 

Q.  How do I record a debit card or ACH purchase? 

A.  It's very easy--just record it like a check 

Sarah Dixon, FBS Tech Services Manager
Sarah Dixon, FBS Technical Services Manager
Go to Input | General | Check and clickAdd.   Select the correct bank account and then in the Check Number field enter "Debit Card," "ACH," or "EFT" plus  the date of the entry in numeric format (i.e. "062511" to represent June 25, 2011).  Then complete the remaining fields just like a check.  This entry will be show up as a check on the Check Register/Reconciliationreport and the Clear Checks and Deposit screen. Note that this process can also be used with Accounts Payable payments as an alternative to printing checks.

 

Summer EventsBeach Sunset Schedule 

The "lazy, hazy, crazy days of summer" are a great time to discover what's new and relevant in technology, financial management and production practices.  Click on the links for more information on these events.  

InfoAg Conference, July 12-14, Springfield, Illinois.

Russell Consulting Summer ConferenceJuly 20-21, Des Moines, Iowa.

Farm Financial Standards Council Annual Conference, August 2-4, Sioux Falls, South Dakota.

Carthage Veterinary Service Swine Conference, August 30, Macomb, Illinois.

FBS User Conference, September 1-2, Moline, Illinois.

July Free Webinar ScheduleWebinar Screen

 Basic Accounting, July 11th.

Smart Feeder Reports, July 18th.

Crop Records, July 25th. 

To register, e-mail support@fbssystems.com by 9:00 am CDT on the day of the webinar.

 
Sincerely,

FBS Systems
 

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