The farm financial model is linear and circular. Records feed into reports and reports into decisions. Reports seek additional information from records and call for additional decisions. Reports make sense of the records, allowing mangers to integrate financial sense into production decisions. In the Financial Management Factsheet Understanding the Financial Model, UW-Extension Taylor County Agriculture Educator Sandy Stuttgen illustrates the management-to-decision making process using the financial model.
Understanding The Farm Financial Model is one factsheet in the Financial Management Factsheet series designed to help individuals understand the basic principles of financial record keeping. Additional factsheets in the series include:
- Understanding the Farm Business Balance Sheet, Part 1 and Part 2
- Understanding the Farm Income Statement, Part 1 and Part 2
- Understanding Profitability Using the Farm Business Balance Sheet and Income Statement