Creating Your Farm Cash Flow Projection
06/28/2023
Though these complaints contain some elements of accuracy, there are solutions to these issues. It is common for the first attempts at budgets to lack accuracy, but the more they are developed, tracked and regularly adjusted to current prices and production, the more useful they become. In a few years they can be extremely valuable and one of the most useful financial tools of professionally run operations.
In a recent article by Norm Brown, President of FBS Systems, Inc., ASAC Board Member and CAC, Norm details the need and value of developing cash flow projections as well as a comprehensive outline of all the information needed to create the budget. His methodical approach simplifies a process that might seem overwhelming.
Follow this link to Norm’s comprehensive article:
https://www.fbssystems.com/farm-management-software-blog/how-to-create-your-farm-cash-flow-projection
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This article is the personal opinion and perspective of the author and may or may not be consistent with those of other ASAC Members. ASAC as an organization does not advocate positions on issues.
Posted by:
Don Tyler
ASAC Board Member
Tyler & Associates
One of the more frustrating conversations that I have with agricultural operators as well as many entrepreneurs is the discussion about whether or not they need to create a monthly budget for their enterprise. The most common excuses I hear for not bothering to develop a budget include:
• “I tried it once and by March it was so far off I threw it away.”
• “How can I make a budget when I have no idea what my main input and market prices will be?”
• “That’s a lot of work for something that isn’t going to be very accurate.”
• “Agriculture is so unpredictable there’s no way to create a budget that is accurate enough to use.”
Though these complaints contain some elements of accuracy, there are solutions to these issues. It is common for the first attempts at budgets to lack accuracy, but the more they are developed, tracked and regularly adjusted to current prices and production, the more useful they become. In a few years they can be extremely valuable and one of the most useful financial tools of professionally run operations.
In a recent article by Norm Brown, President of FBS Systems, Inc., ASAC Board Member and CAC, Norm details the need and value of developing cash flow projections as well as a comprehensive outline of all the information needed to create the budget. His methodical approach simplifies a process that might seem overwhelming.
Follow this link to Norm’s comprehensive article:
https://www.fbssystems.com/farm-management-software-blog/how-to-create-your-farm-cash-flow-projection
= = = = =
This article is the personal opinion and perspective of the author and may or may not be consistent with those of other ASAC Members. ASAC as an organization does not advocate positions on issues.
Posted by:
Don Tyler
ASAC Board Member
Tyler & Associates
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