Home » Farm Financial, Development & Transition
The University of Wisconsin-Madison Division of Extension Financial Management & Strategic Planning programs, information and resources intend to improve the farm financial and decision-making skills of Wisconsin agribusiness, farmers and farm managers, agricultural lenders and educators.
Information on how to use farm financials to explore farm business decisions. This course will help farmers evaluate their finances, take the pulse of their farm business, and set goals for the future of their operation.
Farm Business Financial Management Model
The farm financial model helps the farmer make the best decisions for the farm business. From record-keeping to financial analysis, this model illustrates how to make sound financial decisions and identifies tools to help in the process. To understand the farm business’ records, one needs to understand the purpose records serve to and for the farm manager. The Farm Business Financial Model offers a process for informed decision-making.
Organizing the records provides the farmer with the financial information necessary to complete management reports, which are also known as financial statements. The Farm Financial Standards Council (FFSC) recommends farmers create four financial statements from which the financial position and performance may be analyzed. Financial statements should be prepared on a consistent basis. Statements include balance sheet, income statement, statement of cash flows, and statement of owner equity.
Understanding the farm business’s history of financial position and financial performance provides a basis for the farmer to make decisions and plan into the future. Pro forma refers to the future view of the farm’s financial position and performance. For example, what would the balance sheet look like after a future expansion? The future financial position can be analyzed for feasibility, profitability, and risk-ability. Pro forma financial statements complement the farm’s budgets. Cash, partial, and enterprise budgets are commonly used to assist the farmer in decision-making.
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Business Development, Transition & Succession
Planning for the future of a farm business is complex. There are many moving parts. Extension’s network of County Educators and State Specialists assist with workshops and one-on-one facilitation with farmers and farm families working on farm business development, succession, transition plans, including the communication, financial, and estate planning issues. This section includes information, resources, planning tools, and programs in Wisconsin on the topics of Farm Succession & Estate Planning and Beginning Farm & Enterprise Development.
Looking down the road at the future of the farm is never an easy process. And navigating all the legalities, paperwork, budgeting, and communication with different family members can be challenging. We are here to help you.
Extension offers resources, information and networking opportunities for farmers interested in exploring and assessing new business ideas or revenue streams to their operations.