Farm Management Skills Programme: Module 5 – Finance & Money

Module 5: Finance & Money

Learn how to understand accounts, turnover ‘v’ profit, taxation and investment appraisals.

Aims

The module aims to:

• Stimulate (or revive?) your interest in the Economics and Finance of Agriculture
• Equip attendees with an understanding of the key financial statements – Balance Sheet, Profit and Loss, Cash Flow and Source and Application of Funds
• Demonstrate how to compare and contrast farm performance and stability through key performance indicators associated with the key financial statements
• Develop understanding of the role of natural and human capital in building the farm business to meet individual and / or family goals
• Develop understanding of financial planning techniques in the context of the Management Cycle
• Allow attendees to understand the difference between cash and profit and understand what providers of capital are looking for

Topics

The topics covered in the module will include:

• The major financial statements and tools: measuring Net Worth, Profit and Cash Flow; how they relate to each other and what they tell us over time
• The importance of costs in farming: why Variable Costs are fixed and Fixed Costs are variable; how to calculate and understand depreciation
• Sources of capital and the importance of profit – the distinction between cash and profit
• Benchmarking your performance – uses and limitations – sources of data
• Getting the figures into the right format
• Planning for change – investment appraisal and financial decision making.

Learning Outcomes

By the end of the day each trainee will be able to:

• Demonstrate an understanding of important economic and financial concepts as they relate to farming and the importance of recording, monitoring, planning and control, both for day-to-day management and for longer term planning
• Assess the financial position of a farm business and identify areas of concern through analysis of the three main financial statements
• Understand how to control farm costs and what is needed to access capital
• Evaluate farm performance using financial data, key performance indicators and benchmarking
• Develop basic plans for a business through an overview of financial planning techniques

Please note that the above aims/topics are subject to change

Delegates booking all eight modules will benefit from a discounted rate. Please email events@soc-ag.org for more information.