What Are You Getting Out of Your Accounting Software?

Finance First

The right data about your farm is like a treasure trove for decision-making.

Published on: August 19, 2013

Have you ever gotten stuck in your accounting software? Maybe you couldn't get it to print a report you wanted to see. Maybe it was tricky to navigate. Or you just aren't a big fan of entering numbers into the computer for hours.

If you're a numbers person who loves balancing the checkbook to the penny, this might even be fun for you. But if you can't stand accounting or don't feel comfortable using your software, it could always end up at the bottom of your to-do list – or possibly not get done at all.

That data in your accounting software gets used to create financial reports and analyses that can help you make decisions about your operation. So it's important that the information entered into that software is accurate and in the right slot.

The right data about your farm is like a treasure trove for decision-making.
The right data about your farm is like a treasure trove for decision-making.

But how do you know if the information you're getting from your accounting software is accurate? This information can be a treasure trove of financial data about your operation – but only if it's the right information.

Some farmers are missing out on opportunities because they don't have the data they need about their operations. Here's why: One of the trickier things about farming is that your crop year isn't the same as your tax year. You might spend quite a bit of time preparing your books for tax purposes, but you can't use it to look at your crop year.

So you might not analyze the data about your crop year as much – but that's where you get the best information to help you make decisions. It's best when you can simply transfer this information from your software to an accrual balance sheet – which shows your costs and revenue based on the crop year.

Accounting software, used well, is more than just a computer program. It makes it easier to create financial reports. It can help you locate areas to improve your operation. When you know how to analyze the information, you can use what you've learned about your farm to change things, moving toward success.

It's mostly a matter of knowing how to use the program to do what you want it to do. You might want someone who can teach you to navigate the software and learn the features that you want to be able to use. Then you can run reports on your own – or you could turn over all of the bookkeeping to a partner to do that for you.