Importance of Keeping Good Farm Records and Accounting for Agricultural Businesses
The Evolving Nature of Farm Accounting
Many people might associate farming with getting back to the land. But the fact is that farming has changed; the long lonely days without electricity, running water, a radio, and central heating is long gone.
Today’s agricultural operations are much more modern and business-oriented.
To be successful, farmers need to be good producers. Farmers also need to be financial managers; that means keeping accurate farm records and establishing and maintaining a proven record keeping system.
After all, keeping good farm records does more than help get you prepared come tax season. Farmers need an accurate farm records system, bookkeeping, and financial planning system to track all of the farms business activities.
Keeping the books up-to-date is critical to overall farm management and ongoing profitability.
Benefits of Accurate Farm Record Keeping
Below are just some of the benefits of keeping farm records accurate and up to date.
- Measure efficiency and progress
- Easier to prepare accounts at year end
- Help plan for GST/HST payments
- Avoid over/under tax payments
- Identify strengths and weaknesses in the farm business
- Help manage changes and improvements in the agribusiness
- Make productivity projections
- Help maximize the expenses you claim and minimize tax burden
- Make it easier to pay employees and creditors and see what is owed
- Simplify process if you want to get a loan or sell the business
- Easier to distribute profits to shareholders (dividends)
- Quicker for partnerships to view profits and losses
- Make it easier should the business get audited by Canadian Revenue Agency
Outsourcing Farm Records to a Tax Consultant
Farming is a labour-intensive job, and some farms do not have anyone with the time or background in accounting. On top of that, farms have become larger and more complicated.
Outsourcing tax planning, tax preparation, bookkeeping, accounting, and financial planning services means keeping up to date with record keeping.
It also ensures the business is up to date with any changes in Canada’s ever-changing agricultural tax codes; this can save the farm time and money.
FBC, Helping Farmers Keep Records Accurate and Up to Date
FBC has worked exclusively with Canadian farmers and small business owners since 1952. We help agribusinesses keep their records accurate and up to date, FBC also helps businesses minimize their tax burden and maximize their assets.
What sets FBC apart? We are the only firm in Canada to offer an integrated tax services on a year-round Membership basis. For a fixed fee, Members get access to our tax planning, tax preparation, consultation, bookkeeping, and financial planning services.
FBC provides all new Members with a review of their previous 3 years’ tax returns.
For more information on FBC and the services we offer, call us today at 1-800-265-1002 or submit an online form and an FBC tax specialist will contact you at your earliest convenience.