financial management

How Can I Improve Labor Productivity?

  • September 14, 2018

  • Michael Langemeier

Increasing labor productivity enables an industry or economy to produce the same amount or more output with fewer workers. Because labor productivity is directly related to output, it has a…
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What Should My Farm Benchmark?

  • September 7, 2018

  • Michael Langemeier

Benchmarking involves comparisons of a farm’s processes and performance measures with past performance, and with best practices and performance measures of other farms. Benchmarking is an important component to a…
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Operating Profit Margin Benchmarks

  • August 24, 2018

  • Michael Langemeier and Elizabeth Yeager

This article examines trends in the operating profit margin for a sample of farms over a ten-year period and develops financial performance benchmarks. Specifically, using KFMA whole-farm data for farms…
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Agricultural Debt Continues to Increase

  • August 17, 2018

  • Brandy Krapf, Dwight Raab, and Bradley Zwilling

Agricultural debt on a nominal basis in Illinois has been increasing since 1991. Data from the U.S. Department of Agriculture (USDA) and Illinois Farm Business Farm Management (FBFM) are shown…
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Cash Is King – Revisited

  • July 20, 2018

  • Bradley Zwilling, Brandy Krapf, and Dwight Raab

In good times cash is king and in not so good times it is even better. There are three primary liquidity ratios that are important from a business perspective. And…
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Weekly Farm Economics

Trends in Farm Balance Sheets over Time

  • March 13, 2018

  • Gary Schnitkey

Trends in the financial position of Illinois farms are presented in this article. Overall, farms gained financial strength from 2006 to 2012. Since 2012, working capital has declined. The net…
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IFES 2017: Where To From Here

  • January 5, 2018

  • Dwight Raab

While yields for most have assisted in mitigating working capital losses, commodity prices continue to present challenges in creating positive cash flows and profits. Corn at less than $4 continues…
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U.S. Farm Sector Financial Performance

  • October 18, 2017

  • Michael Langemeier

Metrics that can be used to measure farm profitability include earnings before interest, taxes, and amortization (EBITA), net farm income, the operating profit margin ratio, return on assets, and return…
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U.S. Farm Sector Balance Sheet

  • September 22, 2017

  • Michael Langemeier

U.S. net farm income has declined approximately 49% since its peak in 2013. The balance sheet for the U.S. farm sector continues to adjust to the declines in U.S. net…
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The Deferred Tax Monster

  • May 19, 2017

  • Brandy Krapf, Dwight Raab, Bradley Zwilling and Bailey Fletcher

Because agriculture producers can use cash accounting for federal and state income tax purposes, there is a recognizable difference between taxable farm income and accrual farm income. These differences can…
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Transferring Business Management

  • April 7, 2017

  • Michael Langemeier

Transferring business management between generations is one of the most critical steps in transitioning the business from an older generation to a younger generation. Having said that, in numerous instances,…
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Agricultural Debt Continues to Increase

  • February 17, 2017

  • Brandy Krapf, Dwight Raab and Bradley Zwilling

Agricultural debt on a nominal basis in Illinois has been increasing since 1991. Data from the U.S. Department of Agriculture (USDA) and Illinois Farm Business Farm Management (FBFM) are shown…
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