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Comparison between general and analytical results account in three Galician dairy farms. A descriptive evaluation
Botana, X.R.; Cainzos, J.
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Objectives: With the aim of evaluate the economic result and the main areas of improvement, economic management programs have been implemented in Galician dairy farms. These economic evaluations are mainly based on the development of the general income statement (CRG) of the dairy farm activity based on General Accounting Plan 2007 (Real Decreto 1514/2007, PGC) procedures. However, development of an analytical income statement (CRA) allowing the differentiation of the economic results of the main economic activities present in dairy farms (Dairy – milk yield, Land - agricultural production (corn and grass silage), and Rearing - replacement heifers) was proposed. So, the objective of this study was to verify if this analytical accounting could provide useful information in the economic management of dairy farms compared with the income statement not split by sections.
Materials and methods: Three dairy farms (A, B, C) located at Lugo province (Spain) with different business models were selected. Farm A is a dairy farm with intensive management system, containing an average of 113 milking cows in production, 1,23 million of liters sold and 56 hectares of land. Heifers were reared by an external company. Farm B is a cooperative dairy farm with intensive management system, containing an average of 218 milking cows in production and 2 million of liters sold. They owns 149 hectares of land and heifers were reared into the farm. Farm C is a ATC* dairy farm (*Agrarian Transformation Company ) with intensive management system, containing an average of 110 milking cows in production and 1,1 million of liters sold. They owns 60 hectares of land and heifers were reared by an external company.
For the analysis of their economic results, both the CRG and the CRA were performed in the three dairy farms during 2018, following the principles of the PGC. In the CRA, the income and expenses corresponding to each of the defined sections (dairy, land and rearing) were allocated, so that we obtain three independent income accounts. The necessary information is obtained from the following sources: Invoices of expenses and income of the companies, official accounting of farms, ReproGTV® (on-farm dairy management software) and Gescarro® (RMH® TMR software). All information is processed using the Excel 2016® program.
Results: The results of the general accounting for the three farms indicated that all of them obtained positive benefits during fiscal year 2018:
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Farm A: € 46.158 net profit, € 37,75 /1.000 liter of SCM* sold (*Solid Corrected Milk: 4.0% fat, 3.3% protein) and a net sales benefit of 7.7%.
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Farm B: € 95.147 net profit, € 47,60 /1.000 liter of SCM sold and a net sales benefit of 9.7%.
- Farm C: € 32.403 net profit, € 29,95 /1.000 liter of SCM sold and a net sales benefit of 6.9%.
However, the CRA analysis indicated that the result of the different sections evaluated was independent of the overall result, and also variable among the 3 dairy farms. Thus, in farm A and C the sections Dairy and Land have yielded benefits (€ 31.147 and € 2.283 for milk; € 24.457 and € 39.827 for Land, respectively), while the Rearing section has been deficient for both (€ -9.446 and € -9.707, respectively). In farm B the Land and rearing sections have yielded benefits (€ 135.202 and € 12.229, respectively), while the dairy section caused losses (€ -52.284 ).
Conclusions: Implementation of the CRG is an essential tool to evaluate the economic result of the farm in general, as well as to know the structure of expenses and incomes. This evaluation helped us to visualize the CRA benefits to identify areas of improvement that CRG can not identify, due to the fact that results of some sections can mask the results of others.
Keywords: Dairy, account, galician, economic, results.
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Affiliation of the authors at the time of publication
AIRA Sociedad Cooperativa Galega, Taboada, Spain;
Elanco Animal Health, Greenfield, IN, United States.
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