January 11, 2013 12:43
by Brenda Stefanson, PAg
Regional Farm Business Management Specialist
Over the years, groups of farmers have worked together to capture business opportunities, allowing the group to accomplish what the individual group-members cannot do on their own. One of the first of many decisions the group must make as they undertake a business venture, is whether they will form as a corporation or a co-operative. Each of these business structures has advantages and disadvantages.
A corporation is a legal entity that has a separate legal existence from its shareholders and directors. Shareholders and directors are not generally personally liable for the debts, obligations or acts of the corporation. Private corporations are formed by one or more people and cannot sell shares or securities to the general public. Public corporations can issue securities to the public but the corporation must file a prospectus with the Saskatchewan Securities Commission, employ outside auditors and distribute semi-annual financial statements.
There are many advantages to operating as a corporation.
• Limited Liability: Generally speaking, a shareholder is only liable to the extent of his/her investment in the corporation.
• Continuity of Existence: The existence of a corporation is not affected by the death or bankruptcy of a shareholder or director.
• Ownership is transferable: Shareholders can sell or transfer shares to others.
• Tax advantages: Accountants and tax professionals are best equipped to assess the tax advantages or disadvantages of the business structure.
Some of the disadvantages of a corporate structure include:
• Corporations can be costly to form.
• Corporations are closely regulated and require extensive record keeping.
• Shareholder control is based on size of investment.
• A large investor could assume control of the corporation.
• Conflict may develop between shareholders and/or between shareholders and management.
A co-operative is a corporation organized and controlled by its members. Co-operatives are separate legal entities and therefore, share the limited liability and other characteristics with corporations. The democratic principle of “one member, one vote” is the characteristic that sets co-ops apart. Profits of the co-operative are distributed among members as patronage dividends.
The advantages of the co-operative structure include:
• Democratic control: The one member, one vote principle ensures co-operatives are owned and controlled by the people who use them.
• Limited Liability: Members are not liable for the debts, obligations or acts of the co-operative.
• Patronage Dividends: Surplus earnings are distributed as shares or cash to members in proportion to use.
There are some disadvantages to using the co-operative structure:
• Member participation determines the success of the venture.
• Decisions may take longer.
• As with corporations, record keeping is extensive.
• There is the potential for conflict between members and/or between members and management.
• There is less incentive for members to invest additional capital.
Corporations and co-operatives share many characteristics and both have been used successfully by groups of farmers to capture opportunities or solve problems.
For more information on this topic contact your Regional Farm Business Management Specialist at 306-946-3214 or the Agriculture Knowledge Centre at 1-866-457-2377.
July 23, 2012 17:45
Brenda Stefanson, PAg
Farm Business Management Specialist
Regional Services, Ministry of Agriculture
Watrous Regional Office
Farm families have always worked together to build successful farm operations. On many farms, the human resource plan assigns much of the labour and management tasks to family members, young and old. Today’s young farm operators learned their production and management knowledge as they worked side-by-side with parents and grandparents. Now, they will pass these skills on to another generation of farm kids.
Family farm life provides a stimulating learning environment for children of all ages. The knowledge and the work ethic they develop while helping on the family farm will serve them well in their future careers. However, the farm is also a workplace in which numerous health and safety hazards are present. Here’s some practical and common sense advice for busy farm families to ensure the safety, health and well being of their children and teenagers.
Identify Hazards. There are numerous hazards on a farm including machinery, chemicals, unpredictable livestock, enclosed spaces (grain storage, etc.), and electricity. An important step to preventing tragedy is to make a list of all the things that could seriously harm a younger child. Develop fenced-off safe play areas to keep toddlers and younger children away from workplace hazards. As children grow older and increasingly participate in farm activities, continue to work with them to assess the hazards and ensure that older children are appropriately trained.
Base Expectations on Both Age and Maturity. Children grow and mature at different rates. Young adults tend to overestimate their skill and knowledge levels when asked if they can perform a task. Parents are the best judge of when a young adult has the maturity to take on farm chores that are hazardous. Initial training and supervision is important to ensure your child can do the chore safely.
Emphasize Safety and Model Safe Behavior. Consider your own behavior in busy and difficult times. Do you take shortcuts that compromise safety? Children will learn your habits… both good and bad. Keep them safe as they learn about farm work through the consistent demonstration of your own good habits and safe work practices.
Develop and Enforce a Safe Environment. Set up appropriate rules for your children to follow and monitor them consistently. Utilize the many government and community agencies that focus on farm safety to learn more about protecting your loved ones on the family farm.
The Agriculture Health and Safety Network, the Ministry of Labour Relations and Workplace Safety, and the Ministry of Agriculture can provide you with information and resources to help you keep your family and employees safe as they work and play this summer. As we look forward to a busy and productive growing season and our children enjoy their summer vacation, keep safety in mind.
For more information, please contact:
Watrous Regional Services Office at (306) 946-3220,
Agriculture Knowledge Centre at 1-866-457-2377or
Visit our website at www.agriculture.gov.sk.ca.
June 2, 2012 10:28
Hello and Welcome!
Blogging and social networking as a communication environment is one of those great mediums that we are very excited to be a part of.
Our clear objective in joining all of you at HorseOwnerToday is to post information on the web about risk management and insurance as it relates to horses and equine activity for everyone’s benefit.
That said, let me tell you about myself and how I got to where we are today.
Some of you may know me as, Mike King the “Insurance guy”. I am proud to say that my articles regarding insurance over several years in a variety of publications and public speaking Q and A sessions across Canada have been read and seen by a wide and large audience.
However, many of you may not know that I have been involved in the horse industry for more than 40 years – riding, training, managing a barn, competing, teaching, judging, horse show organizing. I seem to have seen just about all of it – and for the last 17 years I have been a dedicated insurance broker specializing in the development and delivery of insurance products and services across Canada – all related to horses.
Drawing on these years of interacting with horses and their people there is no doubt in my mind that the basic needs of the equine community are the same no matter where the horses are. We all thirst for information on ways to deal with life with horses and the best information comes from others who have been there, done that.
I am hopefully that over time, I can share solid, consistent and non-partisan information about many insurance related topics including:
a) What insurance is (and what it is not)
b) How you can use insurance to your advantage
c) How to avoid duplication in coverage
d) What type of insurance you ‘really need’ for you and your horse
This great thing about this site and blogging in general is that all of us get to have a conversation and with that all said, I really hope to hear from you with questions/comments – whatever!
Mike King is the horse industry specialist at Capri Insurance and is responsible for the risk management and insurance programs which benefit various regional, provincial and national equine associations.