Dairy NZ

Review and update your business plan

Closing out financial year 2010/11

• The payout is looking healthy for 2010/11 and hopefully this will mean that the majority of farmers have tax to manage. Make sure that you:
• Get your accounts into your accountant promptly so that you don’t overpay or underpay the next provisional tax instalment
• Discuss income equalisation schemes with your accountant
• Consider what expenditure you can pull forward into this financial year
• Review your business structure with your accountant as there have been some changes to taxation regimes that may mean an alternate structure is appropriate. Talk to your accountant about getting your 2010/11 accounts entered into DairyBase. This provides a good opportunity to benchmark your business performance
• If you are starting out in business on your own account in 2011 check out the IRD Guide to starting your business (http://www.ird.govt.nz/yoursituation-bus/starting) and register to have a business advisory visit to help you set up your systems.

Preparing for financial year 2011/12

• Spend some time setting and clarifying your goals for the next year. Next, put together an action plan to achieve them
• The Financial Advisors Act is impacting on the level of advice farmers can get from their bankers in particular, it is rare for them to be providing budgets these days. Check out the DairyNZ budget templates as a starting point to develop your own budgets
• Ensure you have robust budgets in place for the 2011/12 season. This means that you have investigated a couple of scenarios and have a plan to deal with risk such as adverse events, e.g. drought, or a drop in payout
• Take the opportunity to look at your purchasing. Are you getting the best deals available on items such as farm supplies, insurance or interest rates
• Remember to use your Rural Professionals to support your business. Call on them for advice and use them as a sounding board when making decisions.