FINPACK: OSU Extension Offers Farm Financial Analysis

In today’s capital intensive agriculture, every farm business needs a balance sheet that is updated annually at the very least. A balance sheet is often required by a lender to show the net worth, liquidity and leverage position of the farm business. However, as farm businesses develop and analyze their balance sheets over time, the information on assets, debt structure and net worth changes can provide valuable insight into business strengths and weaknesses. FINPACK agricultural software, developed and supported by the Center for Farm Financial Management at the University of Minnesota , has set the standard for agricultural balance sheets.

The future is often dictated by the past. Before making decisions that will affect the future of a farm business, the past year’s profitability should be calculated and compared to previous performance and industry benchmarks. The FINPACK, profitability analysis program is called FINAN which provides a complete accrual analysis, of the whole farm as well as individual enterprises which include income statements, cash flow reconciliation, the “Sweet 16” farm financial standards ratio analysis, and production analysis. Financial threats and opportunities can be identified with a FINAN financial analysis.

How do you know if a major change in the business is financially feasible? The FINLRB, or Financial Long Range Budgeting software program, will help farm businesses answer the “what if we do this?” question and will help you evaluate the financial implications of business changes before the money is actually committed. Strategically positioning a farm business is critical in today’s rapidly changing agriculture environment. The FINLRB program is an excellent tool that helps you evaluate the changes you need to consider to remain successful.

OSU Extension Educators can bring FINPACK to your farm. Get started for the first-time or use FINPACK again. OSU Extension and FINPACK have been assisting farm businesses for nearly three decades. Contact your local OSU Extension office.

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