Present-day farm operations are becoming more and more business oriented than yesterday farm operations. Being a good producer is no longer good enough to remain in business. The key to becoming a successful farmer today is being a good producer as well as a good financial manager.

The first step in being a successful farm manager is keeping good, accurate records and establishing a sound record-keeping system. Farming is a business and records can be helpful in planning improvements for that business and making proper management decisions.

Farm managers need a complete and accurate farm records system in order to make informed management decisions that will help maintain or improve farm business profitability. Records can help the manager plan and implement farm business arrangement and do estate and other transfer farming. Also, farm managers can use records to determine what the efficiencies and the inefficiencies are, measure progress of the business and plan for the future.

There are many farm record systems. They range from simple, hand accounting systems using pencil and paper to sophisticated double-entry computer-accounting systems, which require computer operations. Some require a mix of hand and computer operations. Choose a system that is easy to understand and designed specially for farm managers.

The first step is to determine your objectives for the system – both personal and business. For farm managers who do not want or need a system for business and financial management, a relatively simple system that satisfies reporting requirements may be adequate. For those who are heavily in debt or who want to improve profitability, a more complete and detailed system is probably required.

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Remember a good record-keeping system is one that will provide the necessary information and provide the information when needed. It will furnish the necessary information for understanding the activities of your farm operation.

In this post, we give farmers reasons to be very particular about records keeping.

Major Reasons for Keeping Farm Records

1. A requirement for support by lenders, agencies, etc.

Lenders, government agencies, insurance companies and many other bodies demand good records before providing help to farmers. Extension Agents of Agricultural Agencies sometimes require good records kept by farmers to be able to give them good technical advice on their farms. Financial institution and other lenders would require good records on the farm’s income and expenditure before giving out loan facilities to farmers.

2. Better farm planning and forecasting

Farming is a business and good farm records keeping helps the farmer to plan and do a realistic forecasting. Records keeping provides valuable information on the methods that work and why others did not. In budgeting, the farmer can better predict price changes of inputs and produce from expenditure and sales records kept from previous seasons. The farmer can determine how much is required for farm expansion from good farm records.

3. Better prediction of rainfall and weather patterns

Records on rainfall incidence and amount over a period of time is very relevant. A farmer, from the records, decides when to plant and when to carry out other activities on the farm. More so, farmers who depend solely on rainfall, use these records as a guide throughout the farming season. Besides, temperature changes also have significant effects on plants, especially at tender stages. It is, therefore, important for farmers to have a fair idea on temperature changes at certain times in the season. We advise farmers keep a simple rain gauge and thermometer for the measurements of rainfall amount and temperature respectively.

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4. Track income and expenditure

Farmers most of the time are not able to give proper accounts on their cash inflows and outflows. This is basically because they overlook and do not record “petty” expenses and incomes (like feeding and costs of phone calls). Keeping proper records, will at any time of reconciliation, give the farmer the correct amount of money spent or gained from the farm. Moreover, this helps in proper planning and budgeting.

5. Better management of farm

A farmer who keeps records on seed germination rates of the seeds bought is in a better position to select better seeds for seasons. Besides, records keeping helps to determine the right type of crop to grow on a particular type of soil, at a particular time of the season for best yield and better pest and disease management. In the case of livestock, the farm keeps records of the bloodlines, pest, and diseases, feed types and consumption, etc. These records help to prevent inbreeding, control pests and diseases, provide the best feed for optimum performance and a whole lot.

Farmers cannot continue to avoid this activity for the reason of time consumption or any other. So we advise, that spending an average of 10mins each day on the farm to keep farm records is very much worth it. It will save the farmer lots of time and money.

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One set of accurate records should be enough to satisfy all of your needs. If you keep good records of production, expenses, income, and weather, you should have all of the required information for any purpose, from crop insurance to lenders to your own needs. You should be able to make informed conclusions regarding the past and to plan for the future.

Good records lead to better decisions and hopefully higher returns.

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