Many businesses pay from £700 upwards for their annual accounts to be completed. How many actually use the accounts to assess their position and profitability?

Accounts show real costs, all be it sometimes not broken down into enough detail. But, they can provide a good starting point to see where things have gone wrong, or gone right. Questions that should be raised from annual accounts are as simple as:

Did I make a profit?

Did the profit cover my drawings?

Did my balance sheet improve?

Is my output, measured by sales, growing?

Are my costs increasing faster than my output?

These questions will provide a starting point for some decisions on best way forward.

In the current climate of falling milk prices it is easy to become despondent, but in most situations there are things that can be done. An important starting point is to benchmark your business and see where weaknesses lie. CARA as a company produce management accounts for many farms, which enable like to like comparisons. This process gives producers a real pence per litre cost of production, and shows where improvements can be made.

Contact us if you are interested in moving your business forward and seeing how you can reduce your production cost.