The day-to-day activities that take place on Irish farms generate a lot of valuable information that can be used to maximise income and improve performance.
More often than not, however, this is an untapped resource either because farmers don’t have time to record their transactions on a daily basis or because they don’t have the necessary skills to analyse and use relevant financial information in real-time.
Recent research conducted by farm accountants ifac found that more than 50% of farmers do not prepare budgets or forecasts for their business with many citing lack of time as the main barrier¹.
Yet, in sectors like dairy and beef where the top 25% significantly outperform other farmers, those who make time to analyse and use financial data about their business are not just achieving greater efficiency and better returns, they also have more clarity and confidence when making decisions and find it easier to prepare for meetings with advisors and banks.
So, how do top performers maintain accurate, real-time information about their business when other farmers don’t have time for these activities?
User-friendly management tool
Until relatively recently, most farm management tools were designed to record transactions rather than to analyse data and deliver insights in real-time. Inputting data was a chore often pushed aside when more urgent tasks on the farm took priority.
Receipts and documentation piled up, sometimes only recorded at year-end when they were needed for accounting or tax purposes. Little or no emphasis was put on the insights that this information could generate to help farmers maximise income and manage their businesses more efficiently.
Now, however, technology can automate many data input processes making it relatively easy for farmers to maintain up-to-date, accurate information about their business.
Mobile apps allow transactions to be recorded in real-time while automated data feeds from banks and other third parties mean less time spent inputting information and easier access to relevant data that can be used to improve farm efficiency and performance.
A new online platform draws on these capabilities to provide a user-friendly management tool for farmers.
By combining the farm’s up-to-date financial data with herd movement information from the Irish Cattle Breeding Federation (ICBF) database and expert advice from ifac, FarmPro enables farmers to identify opportunities, manage financial risks, make better financial decisions, improve profits and keep their businesses viable.
Key features of the platform include benchmarking which allows farmers to compare their performance with similar farms in their sector; cash-flow monitoring to ensure sufficient cash is available to meet expenses; variance analysis to track expenditure against budget so that corrective action can be taken when necessary; and production reports to track production and monitor the actual cost of production against forecast.
Farmers with more than one farm holding can see how each individual holding is performing while consolidated reporting is available for group entities.
The platform allows farmers to work collaboratively with their financial advisors and lenders using cloud technology to share real-time information. Each expert can provide insight on farm decisions.
Precise snapshot of farm performance
Ifac chief executive John Donoghue says FarmPro will make farmers’ lives easier and improve farm incomes.
“In successive ifac Irish Farm Reports, farmers across Ireland have expressed the same concerns – they want to know where they stand, be able to make better decisions and have more control over their finances. However, many don’t have the time, the tools, or the know-how to make this happen.
“FarmPro will help farmers to achieve these aims. For the first time, farmers will have access to a precise snapshot of their farm performance using the latest on-farm data, and ifac’s expertise in budgeting, forecasting and benchmarking to help them build forward-looking plans.
Farmers will have real insights to help run better, more profitable farms, and build more resilience into their operations, strengthening their viability and long-term sustainability.”
In agriculture, as in other sectors of the economy, cloud platforms like FarmPro that use a pay-as-you-go, subscription-based cost structure are putting advanced technologies within the reach of even the smallest farms.
With accurate, accessible financial and livestock numbers at their fingertips, ifac clients will be better able to take control of their finances and future.
FarmPro is now available to all of ifac’s farmer clients. Farmers who are also customers of Bank of Ireland can avail of a BOI sponsorship from 2021 onwards, the service is free to all ifac farm clients for 2020.
FarmPro features:
- Monitor cash-flow, profit and loss and balance sheet in real-time;
- Easy forecasting and budgeting;
- Track livestock, crop and milk production sales against operational expenses;
- Automated data feeds (ifac bookkeeping information, bank feeds, ICBF database);
- Check how individual farm holdings are performing;
- Collaborate with farm team and advisors;
- Consolidated reporting for group entities;
- Ongoing support and training.
Further information
For more information on ifac’s FarmPro service, simply click here
References
- Ifac’s 2020 Irish Farm Report represents the views of more than 1,500 farmers and includes insights drawn from an analysis of 2,548 sets of 2019 farm accounts.
