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Vdocuments - MX 24 Consequences of Lack of Financial Plann
Vdocuments - MX 24 Consequences of Lack of Financial Plann
Accountants
Consequences of Lack of
Financial Planning 2016
1
“Farmers who farm for
great lifestyle”
www.ifac.ie
Why Financial Plan?
• Gain better financial understanding
• Capital
• Allows you to budget for capital expenditure
• Income
• It's possible to manage income more effectively through planning.
• Standard of Living
• Cash Flow
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The Three Must Important Questions!
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Why Should You Analyse Past Performance?
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PROFIT IS NOT THE
BOTTOM LINE
14/10/2015
www.ifac.ie
6
Where are Profits going?
• Drawings
• Tax
• Capital Repayments
• Capital Expenditure
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Cash Flow
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Source & Use of Funds
Net Profit / Loss (As per P & L Account) € 97,040.00 Purchase of Land / Quota
Purchase of Capital Items € 20,000.00
Add Back Non Cash Items
Decrease in Stock Values € - Increase in Stock € 15,496.00
Depreciation € 34,060.00
• Are you “paying” your way? – Are your liabilities being paid year on
year?
14/10/2015
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10
Budgeting
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Why Budget & Cash Flow Plan?
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Why Do Budgets – The Farmers Perspective
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The Lessons
• Plans change
• Don’t become beholden
to the plan!
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Stability & Experience are the hallmarks of the
IFAC Service