How your Accountant can Help your Farming or Agribusiness
Agribusiness in Queensland is as diverse as it is widespread. With 88.4% of the state made up of agriculture businesses who rely on a vast array of living produce, it is little wonder that farm accounting is so complex. Unlike a standard bricks and mortar type business, farming has additional factors to consider such as unique liabilities and insurances, and generally a larger pool of assets. Balancing all of these features is not as straightforward as one might think, which is why having an accountant who understands the full breadth of your operation is so important. So, how can your accountant help your farming or agribusiness?
A Good Accountant Understands your Full Asset List
Your land isn’t just the physical ground you walk on. It is also made-up of what goes into it to keep it at premium quality. Such expenses which need consideration are:
- Irrigation costs,
- PH Management; and
- Weed and pest control.
The Queensland Government have created budgeting tools to help you calculate your assets list. These tools will help you calculate your basic gross margins, budgets and conduct simple cash-flow analyses. But what these tools won’t give you is a thorough breakdown of your profits and loss.
This is where an accountant can help: by compiling comprehensive lists and analysing them for areas of improvement.
Farm Accountants need to Understand Gains versus Losses
The sums required to work out a gain or loss can get quite confusing. Calculating these figures requires considering the fair value of the asset, then weighing it against the point-of-sale costs of the asset.
The sums differ when considering biological assets such as livestock, versus agricultural assets, such as crops. A good accountant, like we at Synergy, can see through this mess, interpret the Compiled Agriculture Accounting Standard and apply the principles to get you the best return.
A Good Accountant Understands Tax Concessions and Implications
Primary producers have access to special tax concessions. These concessions, and any grants awarded by the Government, can affect the amount included in your income each year. They may also impact the amount of income tax you pay each year.
But some Government grants have conditions which can substantially reduce the amount claimed as income. Such considerations can be placed on biological assets or farming land. Your gains versus losses will also factor here.
So, this is where your accountant will need to understand the terms and conditions placed on the grant.
Farm Accountants need to Stay Up-to-Date of Industry Changes
Your accountant should understand how the unpredictable Aussie weather, stressful economic conditions and fluctuating commodity prices can impact your business. All of these facets can also apply significant stress as you try to effectively manage your finances. This is where we can help.
At Synergy Accountants and Estate Planners, we understand these stressors. So, we make it part of our everyday routine to stay abreast of all of the latest changes to taxation, funding and legislation. If your business were to be impacted by any of these changes, we will contact you and tell you how we will resolve any issues or how they can improve your business. This is just another way we show how we care for our clients.
To learn more, or to experience to the Synergy Accountants and Estate Planners difference, contact us today.
*Disclaimer: The information contained in this blog is a guide only and is not intended to be used in lieu of advice from your registered accountant.