With low crop prices and higher input costs, many farmers, producers and farm business owners may be faced with having to make hard financial choices to stem potential losses and lessen financial stress, said a farm business expert with the College of Food, Agricultural, and Environmental Sciences at The Ohio State University.
To help farmers, producers and farm business owners who want to gain insight into improving financial management, Ohio State University Extension is offering a free, four-part webinar series on managing risk and financial management.
The series, called “Ready, Set, Go: Preparing Farms to Successfully Manage Risk,” can help participants better understand their financial situation by focusing on financial statements and using them to their advantage, said Chris Bruynis, an OSU Extension educator. OSU Extension is the outreach arm of the college.
The webinar will offer participants information to help them gain a better understanding of various financial statements and how to use them to make management decisions about their farm business going forward, Bruynis said.
“One of the goals is to help participants get their financial affairs in order so that they can weather these times,” he said. “The information that’s being offered will be of interest to many farmers and farm families, with crop prices going down over the past two years, leaving profits well below where they’ve been in recent years.
“So it’s going to be more critical that we get our finances right. We’re heading into a time where we need to watch our operating capital, not overextend our credit, and make sure we are paying a fair rent on land that allows us to make a profit.”
The webinars run on Nov. 16, 23, 30 and Dec. 7 from 11:30 a.m. to 1 p.m. at the Morrow County Extension Office, Wilhelm Building Conference room or available to individuals at home. To register for the free series at the Extension Office contact 419-947-1070 or for home use, go to go.osu.edu/farmwebsurvey. Home use registered by Nov. 12 will receive the login information and course material on Nov. 13 by email, Bruynis said.
The webinar series includes:
Nov. 16 – Farm Business Planning and Systems Management
– Is the operation large enough and profitable enough to provide family living draw?
– Is the business plan built on economic considerations?
– Is there an adequate system for obtaining management information and monitoring business performance?
Nov. 23 – Introduction to Financial Statements
– Balance sheets.
– Income statements.
– Statement of cash flows.
– Statement of owner equity.
– Projected cash flow budget.
Nov. 30 – “Legal 21” Financial Ratios
– Liquidity: What are options to correct liquidity concerns?
– Solvency: What options does a farm owner have in correcting this?
– Profitability: Rate of return on farm assets — can I really affect this?
– Repayment Capacity: Do I have the ability to repay the loan on the next farm?
– Financial Efficiency: Am I using my money to its fullest potential?
Dec. 7 – Using Financial Data to Drive Decisions
– Determining risk capacity.
– Capital improvement plan — short and long term.
– Individual enterprise analysis to determine profitable enterprises.
– Decision time using case farms.
A North Central Extension Risk Management Education Grant funds the webinar series, Bruynis said. For more information about the webinar, contact Bruynis at [email protected] or 740-702-3200.