The Financial Guidelines for Agriculture, a reference document for those working with agricultural financial reports and records, has received an update to sections within the publication according to members of the Technical Committee of the Farm Financial Standards Council.
There are four major sections that have undergone review and revisions:
- The first is completion of the differentiation of deferred income taxes and estimated income taxes, with the former applying to earnings and the latter applying to valuation equity. By separating these two items on the market balance sheet, users can see the liabilities subtotal before and after estimated income taxes, allowing for a more accurate reflection of financial position.
- The second update involves the culmination of a nearly three-year effort to revise the recommended financial criteria and measures. The original set of Guidelines issued in 1991 included 16 financial measures. Revisions made in 2007 expanded the list to 21 financial measures. This edition reduces the number of recommended financial measures to 13.
- The third update impacts label and terminology changes in Appendices A and B. Appendices C and D were revised based on the new recommended 13 financial measures.
- The fourth update relates to revisions in the glossary.
The Guidelines are used by individuals and professionals working at preparing financial statements for agricultural enterprises as well as measuring financial strengths and weaknesses. These users include farmers and ranchers as well as their accountants, lenders and those involved with their financial recordkeeping programs.
The document is available as a pdf download for $30 at the website for the Council, www.ffsc.org. The new Guidelines went live on Jan. 1. A sister publication, Management Accounting Guideline for Agriculture, received an update in 2020. It is also available at the Council's site.
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