In all spheres of life, adequate information is necessary for decision-making. This is also the case for farming decisions. Records are essential in any management operation.
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Definition and Scope of Farm Records
Records are statements of fact or data concerning a specific subject, which may be specified in physical, monetary, mathematical, or statistical terms. Farm records pertain to information recorded on the day-to-day operation of a particular farm.
Farm records can be defined as the systematic documentation of all activities taking place in a farm enterprise over a given period of time. It is an act of writing down every activity engaged in on the farm in every production season and at different stages of the production process up to the final disposal of the goods and services to the ultimate consumer.
Farm record-keeping is more than just keeping track of what crop was planted in what field; it is a concept applicable to the entire farm operation.
A complete farm record will include all daily activities and transactions, and with a proper accounting system, it should be possible to have a complete estimate of the profit or loss statement at the end of the year.
By keeping a complete farm record on a yearly basis, it is possible to have a comparison between years and thereby determine the rate of growth or deterioration of the farm.
There are three basic types of farm records:
- Resources Inventories
- Production Accounts of Livestock and Crop Operations
- Income and Expenses Records
As a farmer, resources such as land, labour, machinery, breeding stock, management, and financial capital are used. Value must be assigned to these resources, and current inventories must be maintained so that the foundation from which the farm operates is known. From this resource base, food and fibre are produced.
The production account of livestock and crops shows how this resource base is combined with other inputs to yield physical output. Consequently, production records, such as the relationship of feed to weight gain, cow to the number of calves, fertilizer to crop yield, or land to total production, are most critical to the farm’s profits.
Because farmers interact in a market economy, the cost of the feed and revenue from the market hog or the cost of the fertilizer and the price of the grain are equally important. These income and expense records are related to each other and translate production accounts into Naira and kobo.
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Principles of Record Keeping
There are some general principles which apply to all record-keeping, and these are as stated below:
- All records, to be of value, must be accurate, neat, and complete. One way of ensuring that records are accurate is by filling them in as soon as possible after the operation or transaction and by checking them regularly.
- All the results of record-keeping should be compared with some standards, which may be the results for previous years or the results for other farms. By comparing results and discussing problems together, farmers can help each other improve their management.
- The record-keeping system should fit into the farm organization or framework.
- The person responsible for keeping the records should develop a habit of regularly and accurately posting transactions.
- All financial transactions should be made through the bank, and the monthly statement should be reconciled with the cheque book and record-keeping system.
In this article, it has been established that farm record-keeping is more than just keeping track of what crop was planted in what field. It is a concept applicable to the entire farm operation. Some of the principles of record-keeping have also been enumerated.
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Frequently Asked Questions
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