Farm Financial Risk Management Series Part II: Introduction of Financial Systems for New and Beginning Farmers

Abstract

There are many factors to consider before starting a new farm enterprise. Financial management is an important component in the startup and decision-making processes for beginning farmers. The purpose of this series of publications is to inform Virginia agribusiness owners and managers about the farm financial risk management tools, techniques, and resources available to help them prepare and use a financial systems approach for their operations.

This publication introduces the four financial statements that farm managers can use to record and assess historical farm financial performance. The topics covered in this resource are not all-inclusive, but after reading this publication, beginning farmers should be prepared to move forward in planning for their farms.

The accompanying parts in the series are “Farm Financial Risk Management Series Part I: Overview of Financial Statements for New and Beginning Farmers” (Virginia Cooperative Extension publication AAEC-114P), and “Farm Financial Risk Management Series Part III: Introduction to Farm Planning Budgets” (VCE publication AAEC-116P). A compilation of excellent resources that includes examples, how-to videos, and training resources is included in the appendix at the end of this publication.

For questions about this particular risk management issue or other farm startup topics, contact the local Virginia Cooperative Extension office or visit the Virginia Beginning Farmer and Rancher Coalition Program website at www. vabeginningfarmer.org.