Alrich Farms: Cash Flow Analysis
(3 pages of text)
In January 2016, the owners of a family farm near London, Ontario, Canada, wanted to evaluate the financial status of their business. After 30 years in farming during a period that had seen dramatic changes in the agricultural industry, the couple was beginning to think about succession planning for the farm that had been passed down to them from previous generations. The couple wanted to evaluate how well they had managed the farm’s cash throughout fiscal 2015 and would use this analysis to help them determine the long-term stability of the farm's operation in preparation for this succession plan.
This case is to be used as an introduction to the statement of cash flows and its analysis and is intended for undergraduate managerial courses. After working through the case and assignment questions, students will be able to do the following:
- Describe the demographic and technological changes that have taken place in Canadian agriculture.
- Undertake an in-depth qualitative analysis of industry trends in agriculture and current corporate capabilities of a farm business to understand the context for making decisions.
- Build a statement of cash flows and draw implications from this analysis.
- Outline how the owners of a farm could improve cash flows.
Agriculture, Forestry, Fishing and Hunting
Canada, Small, 2016
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