Financial and Credit Analysis
of Farm Businesses

Farm financial performance assessment is the focus of this educational program.

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• Section I provides an overview of the agricultural production sector and the financial institutions and financing arrangements used by the sector.​
   

• Section II focuses on financial analysis and documentation of the financial performance of farm businesses by emphasizing the unique problems of assessing risk, returns, and repayment utilizing standard documents and information sources used in the industry.
   

• Section III emphasizes the critical considerations in capital investment and business organization decisions, including the different leasing arrangements used by farmers.
   

• Section IV offers the perspective of the lender as he or she attempts to structure a loan arrangement to match the customer’s needs and the financial institution’s policies and procedures, to assess the risk of specific credits, and to price a loan.

Assessing Risk in
Production Agriculture

Risks faced by farmers and agricultural lenders are the focus of this educational program which is presented in three sections.
 

• Section I reviews some of the basic concepts of risk measurement and risk management by exploring the general principles of risk management and adapting them to the agricultural industry.
   

• Section II focuses on risk exposure and risk exposure management from a producer’s/borrower’s perspective by first describing the various sources of operational and strategic risk faced by agricultural production enterprises.
   

• Section III emphasizes managing and structuring the extension of agricultural credits and the management of the agricultural portfolio to minimize the credit risk and loss exposure in the portfolio.