Several specialist agricultural studies program areas are offered at selected schools across SA.
Urrbrae Agricultural High School is possibly best known but Lucindale and Cleve are also providing for young aspiring farmers and rural service providers.
My views on the lack of opportunity to enhance financial management and interpersonal skills at school are well known and it was pleasing to get the call from John Solly, the agricultural curriculum developer at Cleve.
After identifying keys areas of financial management on the student's family's farms, John believed new elements needed to be added to the curriculum and he was keen for me to deliver it. I agreed and two days of intense training was delivered by remote learning, using zoom.
Day one had a focus on gross margins, sensitivity analysis, law of diminishing return using a urea application simulation model, analysing the external risks that effect farming and an interactive session on sustainability.
The students then returned to their home farms where they were required to develop a detailed gross margin on a sheep or livestock enterprise. A management intervention had to be applied to this same enterprise and discussion provided on the comparative gross margins, the risks and the mitigation strategies that could be implemented.
Day two was centred on cash flow budgeting and balance sheets. Smaller sessions on business structures, benchmarking and farm finance rounded out the program.
The students were then provided with a case study where, as a school leaver, they would be returning to the family farm to begin their career in 2022. The assignment was to develop a 12-month cash flow budget, combining personal and business income and expenses.
Among the stipulations, they began the year with $3000 in savings, earned $2000 a month as well as additional money from ewe crutchings and six weeks of shedhand work in neighbouring woolsheds and had a 60-hectare paddock to farm.
But they also had to pay $500 a month board, upgrade their old vehicle with a three-year bank loan and pay all personal and cropping expenses on their block, including contract rates to borrow the family machinery.
The students all presented good cash flows budgets and were asked how they would manage the budget deficit and management risks involved in generating the desired income.
They also looked at how efficient the expenses were in generating the income how they would improve the outcome the following year.
The program proved to be a great success in main due to the life-like examples the students were working with - they were learning in context.
The students returning to the family farm are better equipped both from a financial and managerial point of view.
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