Taranaki Farm Accounting Specialist Urges Farmers To Be Proactive About Their Future Finances
The $500,000 government funding for drought recovery has been welcomed by the dairy industry. However, with the current global uncertainty limiting the ability to predict where the milk price will land and the negative implications of COVID-19 affecting contractors’ and farmers’ income, Dairy NZ and Baker Tilly Staples Rodway have teamed up to highlight the need for farmers to understand their finances.
Taranaki farm accounting specialist, Amanda Burling, of Baker Tilly Staples Rodway said: “It’s been a challenging time for the Dairy Industry. The drought, along with the impacts of Covid-19 are providing a lot of uncertainty. The sale yards in lockdown along with the works slowing down due to social distancing rules has had an impact on cashflow. Now we must work together to prepare for next spring.”
Working alongside Business Advisory and Accountancy firm Baker Tilly Staples Rodway, Dairy NZ are offering a free webinar series to all Dairy farm owners and sharemilkers in New Zealand. The 3-part series starting this week will provide advice from various experts within the Baker Tilly Staples Rodway Agri-business team on things like how to budget, understanding financial statements, the depreciation regime and income tax.
Webinar presenter, Amanda Burling, said: “I urge farmers to be proactive about their future finances. The world’s economy is in turmoil and we cannot predict what the outcome will be. We need to focus on CPR for the future health of our farms: change, plan and resilience.”
Amanda provides some essential tips for the coming months:
- Use the CPR model to make
important business decisions moving
- Change is the new normal, get used to it.
- Plan for change, volatility, the unknown. Take control of the outcome, control the controllable.
- Build resilience, your ability to ride out the volatility. Establish what resiliency means for you.
- Make sure you are running a profitable business, build and grow financial awareness and know your position and your vision. Do you understand all the facets of business? Do you understand GST, PAYE, ACC and income tax? There are compliance costs associated with this, find out what they are likely to be.
- Seek help early. Will you need support from a bank? i.e. a loan or overdraft facility. Ensure your account etiquette is good as banks will look at the previous three years ‘behaviour’ in your account. Make sure you pay your bills on time!
- Be open and honest with your goals. You need to be completely open with your key advisors about your future plans and aspirations. Knowing more about you and your goals allows us to form a structure for your business and a plan for the future; and this includes planning software selection and ongoing support. There are products that will meet your needs now but will struggle to grow with your business as it expands. These can incur additional costs down the line.
Plan for the future, plan for change, plan for the unexpected. Monitor your plan closely and get the right people around you so you can utilise all the tools available to you to achieve a successful outcome.
Dairy farmers can register for the webinar series here: dairynz.co.nz/events/