Why Tony developed workshops for farmers
Raised heart rate, steady breathing, constant rhythm of each footfall - my morning run provides some of my most productive thinking time. Today my mind was devoted to this blog – my first for active farmers. I thought I might share a story about why we developed our farmer workshops.
Several years ago, a colleague and I were working with a group of Mallee farmers. Years of drought, increasing overdraft, sign off another tax loss for the accountant and file the paperwork. They were questioning the point of it all. It illustrated what a poor reflection of business performance the annual tax return is, yet for many farmers it is the only formal reporting they undertake.
When we analysed the financials of this group, we used fair market value for land, livestock and machinery. To their surprise, everyone had grown their net worth over time, their equity was improved and their businesses had in fact become less risky. Tax accounting uses historical cost of land, rapidly depreciated values for machinery and livestock values as low as $4/head for sheep and $20 for cattle. It is essential for compliance and tax minimisation, but provides a poor reflection of how your business is performing.
We developed our Farm Business Management Essentials workshop to help farmers interpret their tax returns. It only takes us one day to teach you how to accurately measure your business performance.
I can’t convince all my clients to come on a morning run, but it’s amazing the peace of mind they achieve by better understanding their business.