CXL – WELLINGTON COUNTY Farm Advisor Meeting
March 19, 2020 @ 7:30 am - 9:00 am CDTFree
Topic: Using Financial Data for Management Benchmarking of Dairy and Cash Crop Farms in Ontario
Presenter: Dr. Larry Martin – Agri-Food Management Excellence
Lack of standardization with respect to financial benchmarks can impede farm financial management, because it limits the ability of farmers to understand their performance, diagnose performance issue and focus on what needs improving.
Continuing Agri-Food Management Excellence’s (AME) commitment to helping improve financial management practices on farms, Dr. Larry Martin, in collaboration with a major accounting firm and others to introduce standardized benchmarks for farm financial performance. They have recently released the report: Standardized Financial Benchmarks for Canadian Farm Financial Statements.
The objective of the paper is to determine whether there is a relationship between specific financial benchmarks and relative farm profitability. The goal is to provide producers with a standardized model they can utilize with their own financial data, as well as ratios that they can use to ascertain areas in need of scrutiny.
Actual farm records were segmented on the basis of profitability, measured by earnings per dollar of sales and earnings per dollar of assets. Both measures identified essentially the same farms as the most profitable when arrayed into quartiles from most profitable to least profitable. Then, organizing the operating statement based on five cost categories that apply to all types and sizes of farms, a series of ratios were calculated and the results related to profitability. The results show a strong correlation with overall profitability and provide an excellent basis on which to assess management performance.
Dr. Larry Martin is a principal of Agri-Food Management Excellence, and has 40 years’ experience in the agriculture and food sector. In addition to his role with AME Inc, he is also owner of Dr. Larry Martin and Associates, a consulting operation. Most recently, Larry was inducted into Canada’s Agricultural Hall of Fame in 2018.
Please feel free invite any colleagues who may be interested in becoming a chapter member.
Coffee and treats will be provided.
RSVP by March 17, 2020 if planning to attend to Tom Blonde at firstname.lastname@example.org