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Evaluating farm accounting software

Contributed by Kelvin Leibold Published on 11 April 2017

When it comes to selecting accounting software, think about where you are now and where you eventually want to end up. If you are just new to the computer, buying a comprehensive and complicated financial package will probably leave you frustrated and without any useful records.

Usually, the first step is for an individual to try to keep an electronic checkbook ledger and several broad categories with a limited "chart of accounts." Some people may build their own spreadsheets using Excel to develop a record-keeping system. The basic starting point for a prepackaged software might be with "Quicken Starter Edition" or "Quicken Deluxe." Retail discounters sell these in the $29 range and up, or it can be purchased online. Quicken is available in several different versions depending on your needs. Quicken is a first step and gets you used to data entry, check writing and electronic funds transfer, and helps set up the basic chart of accounts.

It is difficult to keep inventory and several other things that you will find in more expensive software. However, you can use these packages to prepare a net worth statement, cash flow statement, and develop a budget for the coming year.

The "chart of accounts" is the list of the different categories that you are trying to track. For example, this might include seed, chemicals, fertilizer, rent, government payments, personal health insurance and a host of other topics. These different accounts can then be printed out by category, and this allows you to review your expenses and income by the categories and by dates.

The number of software firms has declined in recent years, in part due to the cost of updating the software to keep it income tax compliant. One of the features you may want is the ability to download the software to your tax or tax preparer’s software so all the data doesn’t have to be reloaded. Check with your tax preparer for compatibility.

There are land grant universities and others that have set up chart of accounts for Quicken. They also have tutorials and other teaching materials.

The next step up in software would provide you with more features such as payroll, inventory and more in-depth enterprise analysis. Some include the option of using double entry accounting, which gives you a running up-to-date net worth statement at all times.

You might look to QuickBooks or some of the companies listed below.

Finally, the third tier is a comprehensive enterprise analysis with double entry accounting, payroll and detail analysis. Oftentimes, this would include a consultant and tax preparation as part of a total package.

Figure out where you are, where you want to go and how much time and money you are willing to spend to get there. Check out several different companies and compare price, features and service. They often have a demo disk that is free or very little cost that you can get and run for a while.

A few companies are listed below. This list is not all-inclusive and does not constitute a recommendation for any of these products. Failure of any company to make the list doesn’t imply anything.

Other resources if you are looking for software relating to agriculture in North America are:

Of course you can always use your favorite search engine.  end mark

Kelvin Leibold is a farm management specialist with Iowa State University Extension and Outreach. Email Kelvin Leibold.

—From Iowa State University Extension and Outreach news release