Agricultural organizations: management, accounting, development

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Let's raise the topic of management accounting in such a specific and rather rarely covered area in this vein as agriculture. A lot has been accumulated about the state of affairs in this area of data, but it is difficult to call them encouraging. So, what exactly are we talking about? What is commonly meant by this term?

Management accounting is understood as a system for collecting and presenting information, on the basis of which decisions are made regarding the activities of an organization. Thanks to management accounting systems, it is possible to understand the state of affairs - the state of the enterprise, the rational or not very distribution of cash resources. The ultimate goal of such a system is to increase the efficiency of any production activity.

Main purposes of accounting

As in other areas, the main purpose of management accounting in an agricultural enterprise is to provide managers and managers with the information necessary for competent decision-making and successfulcompany management. Its main tasks include:

1. Drafting a business plan and budget.
2. Calculate costs and define controls with operational accounting tools.
3. Analysis of the received data and development of decisions based on the received reports.

Accounting in agricultural organizations. What are the features?

The management accounting system at agricultural enterprises implies the achievement of an optimal combination of quality and quantity of products issued. The level of economic efficiency characteristic of agriculture is determined, firstly, by the indicated ratio (costs-results), which directly depends on the degree of efficiency in the use of all production resources. Secondly, from the manageability of those processes that are characteristic of them.

Building a management system for an agricultural organization should be based on costs as the main motivating factor. The system of their optimal distribution must provide the necessary information with the required level of detail, facilitate the identification and implementation of those areas of activity that can be considered highly profitable. It is this policy that can increase efficiency in this area.

On reforms in the agro-industrial complex

Our country has been going through certain reforms for a number of decades, the purpose of which is to give maximum opportunities for the development of agriculture. Goals and objectives of such transformations inall details are disclosed by the Government Decree of the Russian Federation No. 717, issued in July 2012. It lists the main tasks assigned to the adopted for the period 2013-2020. program.

What is this serious document about? Priority is given to the optimal organization of agricultural land, stimulating the growth of food production and all major types of agricultural products, preventing the spread of diseases in the animal environment by financing relevant activities, and supporting the infrastructure of the agricultural market. According to the resolution, sales markets should be regulated more efficiently, and the so-called small economic forms of agricultural organizations should be strengthened and supported.

Attention should be paid to more effective interaction of state control bodies with the agricultural sector. The main task for the specified period is a gradual increase in the profitability of this important industry, an increase in the quality of life of rural residents and the creation of conditions under which innovative developments and decent technical support for agricultural enterprises are possible.

About finance

For these years, a serious amount of money will be allocated to the federal budget in order to implement the program. According to expectations, financial injections will predictably bring a number of important changes in the development of the industry. But it should be remembered that the main condition is the targeted and most rational use of the allocated funds.

We should not forget that with the changes in the structure of world agriculture that have appeared after the introduction of sanctions on the import of certain types of products by our country, a sharp increase in the efficiency of this sector and a well-thought-out organization of agricultural products produced by domestic suppliers are required.

Successfully operating agricultural enterprises should increase labor productivity, achieve a higher level of efficiency in growing crops, ensure the uninterrupted procurement of the amount of agricultural products needed in the country's volumes to eliminate its shortage. Particular attention should be paid to the efficient use of available assets - land, arable land, farms, gardens, livestock, transport, etc.

What's important?

The agricultural sector requires the involvement of young and competent managers, new innovative programs and developments at each of the production sites. The organization of an agricultural enterprise requires a clear distribution of responsibilities. Sources of funding, both own and subsidized, should be used to the best of their ability.

To successfully achieve these goals, each business entity in the field of agricultural production must have a well-functioning internal management system. Without it, it is impossible to establish effective production activities, to identify the necessary internal reserves.

Wheresystem?

The main difficulty inherent in the sphere of management of enterprises of the agrarian complex is the lack of complete and reliable information, without which well-thought-out management decisions are impossible. There is currently no system of unified methodological recommendations, according to which it is possible to organize accounting and management for individual sectors of the economy. Because of this, many enterprises are content with revenues much lower than possible, unplanned expenses increase, and reliable data on production costs are lost.

These factors negatively affect the profitability of all areas of agriculture. Unfortunately, the agro-industrial complex of our country has not yet been united by a specialized information management system, thanks to which it would be possible to optimize the activities of agricultural enterprises.

About the value of accounting

In the light of the above, management accounting acts as the main tool, thanks to which it is possible to obtain all the necessary data to make an informed business decision. Its presence at the enterprise leads to the formation of a unified information system and ensures the efficiency and timeliness of decisions made by management and, as a result, the successful development of an agricultural organization.

On the basis of accounting, information databases are created that are different from accounting ones, but without which it is impossible to make important decisions. This system also allows monitoring the most relevant areas of the economy and promotes development among employeescorporate spirit.

Why is the case not moving?

As already mentioned, unfortunately, there is no unified management accounting system for the entire sector of this industry. Measures for its implementation are rather isolated cases. The reason for this is the many difficulties and peculiarities inherent in the activity in this specific industry, the traditionally conservative attitude towards most changes in the management sphere.

Information about the undeniable advantages and additional opportunities that management accounting can give to agricultural organizations is perceived with difficulty and does not find supporters. As a result, there is an acute shortage of specialists capable of effectively organizing this very accounting.

What can be done?

Where is the way out to overcome the current situation? According to analysts, it makes sense to resort to the following measures:

1. Adapt existing Western experience to Russian conditions, without disregarding the presence of successful domestic developments (including the Soviet period), competently apply them in the changed conditions of the modern economy.
2. To develop fundamentally new parameters, according to which the effective organization of agricultural production is possible, combining them into a coherent system with increased control over decisions made in the field of finance and management.

About competitiveness

Ifthe problem of creating a stable viable management information system being introduced at Russian agricultural enterprises will be solved, the competitiveness of this industry will increase significantly. This, in turn, will allow Russian farmers to increase the total volume of sales of their own products and strengthen their existing territorial positions within the boundaries of the domestic market.

Due to the lack of clear regulations in the field of such accounting, Russian legislation is required to develop the necessary regulations with a detailed description of the methods and features of their implementation according to industries.

Organization of agricultural production in theory. Why are there no results?

Theoretical studies that exist in this area today do not provide an effective picture of the possibilities of management accounting in its practical application. Their authors are mainly busy with attempts to transform existing Western methods without taking into account the industry specifics inherent in Russian agricultural organizations. For managers to realize the importance and feasibility of introducing a management accounting system, serious economic research is required.

The basis of accounting should be a well-thought-out procedure for collecting and processing all the necessary primary information. Based on the totality of such data, it is possible to establish cost control in the context of individual objects. We are talking about various crops or their entire groups (in crop production) or animal species in another industry - animal husbandry.

About budgeting

The method of management accounting, called budgeting, allows the heads of agricultural organizations to plan their own capabilities with subsequent analysis of the results. What are the key points of this method? These include targeting, coordination and costing. It is carried out by drawing up operating budgets with control over their activities using performance reports.

The specifics of budgeting for agricultural organizations has distinctive features, namely, the need to plan a variety of indicators (sowing volumes and fertilizers, planned harvesting, growth in milk yield and livestock, the amount of feed, etc.). The budget drawn up must take into account the presence of seasonal fluctuations, the characteristics inherent in each industry (poultry, crop production, animal husbandry, beekeeping), an adjustment for the climatic factor and physiological events - from crop failure to loss of livestock.