Managing your farm finances
James McDonnell a Financial Specialist in Teagasc joins Michael Hennessy on this week’s Tillage Edge podcast to discuss how best to manage your farm finances.
James starts with the basics describing the differences between main concepts like turnover, profit and cash flow. ”Cash flow is essentially a measure of the cash in your account,” he explains. “In certain circumstances you could have a high turnover, have a taxable profit, but little money in your bank account. So for farmers the best measure to track is cash flow”.
James details where farmers should start to get a handle on their cash flow and outlines some of the useful tools like the Tillage 5 minute Cash flow, the Teagasc Cost control planner and e-Profit Monitor which are easy to set up and use. Digging into the profitability on a field by field basis as well as comparing crops or enterprises on the farm will help to develop a better cash flow projection for the coming months. All of these tools are available on www.teagasc.ie
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