Five Tips on Updating Your Farm Accounting System
By Marji Guyler-Alaniz, FarmHer
It’s that time of year, when everyone starts organizing their finances to begin the tax filing process. It’s also a good time to assess how you kept your records last year and how you can improve in the upcoming year. Maybe there are ways you can save time, or money, or both! If you are actively involved in farming, chances are you are not also an accountant by trade (though I am sure some of you might wear both hats). Assuming you are not an accountant, you probably fall in the same boat as me….accounting is something that we have to deal with, rather than something we love to do. I love to take photographs. You love to farm. Neither of us loves to balance the books.
Since I’ve decided that we (ok…I’m talking about myself) don’t love to balance the books, thinking about small business accounting systems can be confusing and overwhelming. Try these steps to get going with a new and improved system today!
1. Find An Accountant
Talk to your accountant or find one in your area. Not sure where to start? Ask your friends or fellow farmers and see who they use. Make sure you talk to at least two (if there are two locally) to give yourself options.
2. Set A Goal
Determine what it is you want to do. Maybe you have an ok system and you would like to upgrade to something that has more features. Maybe you are currently using an Excel spreadsheet or handwriting a ledger and are ready to get started in electronic records. Whatever your situation is, have a goal.
3. Do Your Research
Talk to your accountant, friends and other farmers or ranchers about the systems they use. There are a variety of software programs available and finding the right one to fit your needs will be helpful in the long run.
4. Learn Before You Leap
Spend some time in the tutorials or getting started section. Time spent up front learning is time well spent in almost any new endeavor. You’ll save a lot of headaches doing this. Maybe even look to your local extension office for a class on how to operate in your chosen system.
5. Keep At It
Once you have done the research, found a system and spent some time learning, the next step is to just start doing it! Set aside a little bit of time every week to make your entries into the system so you don’t get overwhelmed at year end.
Being a small business owner myself, I cannot stress the importance of a good accountant. They are an imperative part of your business and will help keep you on track as you move throughout the year. Good luck and I wish you the best will all the goals you set to improve your business in the upcoming year.