Standardized Financial Benchmarks for Canadian Farm Financial Statements Year Two Update
Larry Martin and Joerg Zimmermann
One of our company’s major goals is to provide information that can help managers make good farm management decisions. Our ongoing approach to this is through our CTEAM, Futures and Options, Investment Management and Alumni courses and programs. But occasionally we have the opportunity to provide additional material.
For the past two years we’ve had an extraordinary opportunity to work with the accounting firm of BDO, assisted by our colleague Joerg Zimmermann, to anonymously analyze financial statements of a growing number of BDO’s farm clients. The intent was to try to understand what the most financially successful farms are that lead to their success, as reflected in their financial ratios.
The results have powerful messages for managers, messages that can assist in making better decisions. We want to share this information with anyone who can make use of it for their farm business, and have done so in the report below. BDO now includes an analysis of their customers’ farms against the benchmarks as part of their services.
We will use these results in our CTEAM and Advanced CTEAM programs to assist participants understand their business performance and to develop business strategy going forward. They will have a comprehensive planning model based on the financial benchmarks developed here to use in the course. A base version of the spreadsheet is also available here on our website for download at no cost for anyone who would like to analyze their own financials using the standardized format.
AME would like to thank Farm Management Canada for supporting this project.
Key words: Financial Management; Benchmarking; Management Training.
Sometimes it's easier to understand financials when you can follow along by plugging in your own farm's numbers. We get that, which is why in CTEAM your farm is used a case study for the duration of the course. Here, to make more sense of the AME's and BDO's Financial Report, we've created generic sheets and instructions for you to download below!