AGRICULTURAL VALUE CHAIN: AN APPROACH TO
AGRIBUSINESS 3
Record Keeping in Agribusiness
Introduction
Decision making is the most important responsibility of an agribusiness entrepreneur, the agribusiness manager. Agribusiness management as a decision-making process, coordinates other factors of production to produce the desired output. Adequate information is necessary for decision making. A very important source of information for an agribusiness concern is the firm - own documented record of experience.
A record is a documentation of facts or data concerning a specific subject which may be specified in physical, monetary, mathematical or symbolic terms. Agribusiness records pertain to information recorded on the day-to-day operations of a particular agribusiness firm. The main objectives of records are to control the business, guide future decisions and provide data required for sound planning.
Characteristics of a good Record
For records to be useful they should have the following characteristics:
(a) They should be easy to keep.
(b) They should contain the needed information.
(c) They should provide information when it is needed.
Importance of Records
Accurate and well kept records if efficiently analyzed can be useful to agribusiness entrepreneurs and managers in the following areas:
(a) Identifying strong and weak points in the business.
(b) Providing basis for planning and budgeting.
(c) Describing the history of performance of the business and for making comparisons with other business and for different time periods.
(d) Meeting governmental agencies - demand for tax purposes, production controls e.t.c.
(e) Useful for drawing up feasibility study necessary in applying for credit.
Types of Records
There are different types of records that agribusiness entrepreneurs and managers can keep. The type of record kept and the amount of details collected depends on the purpose for which they will be used. Types of agribusiness records include
Diary: A diary is a record of daily happenings. An agribusiness diary, therefore, records the day-to-day events. Good agribusiness entrepreneurs keep detailed records of all the events that take place in their business in a diary.
Inventory: An inventory is a listing of all the assets, property and resources, owned by the agribusiness firm. It tells the entrepreneur what he owns. An inventory is taken at the beginning and at the end of the business year.
Input Records: These are also known as farm expenses records. They are records of all the inputs used by the business during the year. It gives a record of all expenses for the year. These records can be used to calculate the net income for the year.
Production Records: This is record of all items produced by the agribusiness firm: primary and secondary products
Sales Records: These records are also known as income records. Records of sales of all products are maintained in order to accurately determine the business - s income. This will ultimately show whether the business is making a profit or a loss.