Involve-to-Learn Accounting

Understanding is derived from the use of accounting data to make and review decisions- learning by involvement, not by rote.

Typically at the onset of harvest, forecasting of fuel and service costs are estimated- at the competion of harvest we then compare the actual consumption of consumables used, or as our local bean counter would call them ‘expenses’. For example, if diesel was budgeted at $50,000 but ended up costing $65,000, the analysis would pose the question: Were the excess costs due to inefficient machine use, price rises, or excess yields?

This chapter reminded me that the reality of our business ultimately is in the numbers. Helping to identify that variance analysis is a learning tool, not criticism. Each season that data is collected improves the next cycle. I now involve our driver team in reviewing how maintenance scheduling and inefficient practices are affecting costs. Using the numbers, builds ownership, helping everyone to understand how their decisions shape our financial results.