3.6.2.1.1
Annual Budgeting
Purpose: Annual budgeting involves creating a detailed plan for the farm's expected income and expenses over the course of a year. This plan helps guide financial decisions and ensures that the farm can operate smoothly throughout the year.
Poor Outcome:
No formal budget is created, leading to frequent cash shortages and an inability to pay bills on time. The farm struggles to meet financial obligations, and long-term sustainability is at risk.
Expected Outcome:
A budget is created at the start of the year, covering major income and expense categories. The budget is reviewed quarterly and adjusted as necessary, leading to smoother financial management and stability.
Excellent Outcome:
A comprehensive budget is created with input from all relevant stakeholders. It includes detailed projections for all income and expenses, is reviewed monthly, and adjustments are made proactively based on real-time data. The farm operates with financial clarity and long-term sustainability is ensured.