The new year is right around the corner and with that comes a blank page to create your financial plan for the coming year. The Minnesota Soybean Research and Promotion Council knows the importance of sound farm financial management as well. They are generously sponsoring two workshop sessions aimed directly at building these skills. "Taking Charge of YOUR Finances: How to Survive & Thrive" workshop will help farmers put these tools into action to gain financial management skills.
The workshops will help build strong financial statements:
- The balance sheet gives a snapshot of what is owned and what’s owed against it. Then net worth can be determined. Creating a balance sheet at least annually is important to assess profitability and business gains.
- The income statement measures profitability by determining the net income of your farm. This is calculated by subtracting the farm expenses from the farm revenue for the year. The best approach is to calculate the accrual adjusted income because this factors in changes in inventory and depreciation during the year. By doing this, you learn the true profitability of the operation.
- A cash flow projection helps create a plan each year for your money. The statement of cash flows looks at where cash is utilized in the operation – either for operating, investing, or financing activities. Remaining funds build your cash balance. Planning how every dollar will be best used is important and will get your business off to the right start in the new year.
These financial statements are created using your farm records and will aid you in making important financial decisions for your operation. To learn more about the workshop sessions, go to z.umn.edu/thriveworkshop. To register go to z.umn.edu/thrive2017. For more information, contact Pauline Van Nurden at firstname.lastname@example.org or 320-235-0726, ext 2008.