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Farm, Family & Finances - Part 1

Making Annual Family Business Meetings Successful

Farm, Family, & Finances is a series inspired and derived from our expert speakers from our Women in Ag event.

While the event was for women, the advice in this blog series is for the entire family. We’ll be covering topics like family and wills, taxes, and so much more that deals with complications that often arise when dealing with family, farm, and finances.

The first part in our series is about how to have an annual meeting that honors your family. Before getting into the how, know that you should absolutely be having an annual meeting. If you aren’t, then the following tips offer a great way to get started.

Jolene Brown, who is a CSP, CPAE, Professional Speaker, Farmer, and Family Business Consultant from West Branch, Iowa, has some valuable advice about how to have a successful annual meeting.

We hope you will join us for our 2020 Women in Ag Event. As the calendar turns, it’s time to gather family business members around the table for the annual meeting.

I can hear the mumblings already…

  • Meeting? I don’t have time to waste. Don’t you know I have work to do?
  • Why bother to meet? No one ever follows through.
  • I hate to meet. Everyone just gets all stirred up.
  • Why do we have to meet? We see each other every day!

Sound familiar?  There is a better alternative. I’ve learned, what truly helps, is a clear agenda, one that all members have a chance to review beforehand and add their items. Once finalized, the agenda is delivered at least a week prior to the scheduled annual meeting so that people can prepare their questions and their assigned reports.

For a basic beginning, I like to see at least six items included on an agenda.

  1. Updated list of ownership of business assets—be sure to include names and their ownership of shares of stock/membership in LLC, partnership percentages, and sole proprietor where it’s clear who owns what including new purchases by individuals.  Also, including spousal ownership is appropriate. Be sure to record the annual share value or membership value. Your accountant can help determine this amount.
  2. Financial report and review – net worth, cash flow, budget for next year.
  3. Review contracts and agreements – leases/rentals, employee, review code of conduct, conflict management, communications agreement, etc.
  4. Summary of the succession and transition plans and progress
    • This is clarity beyond labor to management, leadership and ownership. Sweat equity is transitioned if appropriate. This is a discussion beyond job descriptions to the continuation of the business under terms so the business might continue.
    • Review of the buy/sell agreement, exit strategy, and estate plans that affect the continuation and transition of the business.
  5. Business overview and business plans— review the previous year’s business plan and offer input into the new year’s business plan.
    • How did you do? Where are you going?  A business plan has many important parts. Your advisors can help you with the template.
    • Review the business overview segments, having assigned key managers of each area give a report to all at the table. There may be 6 or more key areas.
    • Assign someone to write the revised draft of the new business plan to share with all for review. Add a completion date.
  6. Celebrate and appreciate all you have done and the contributions made—For those of you in a business structure, check your operational agreement or bylaws for other specific items that must be included in your annual meeting to demonstrate you are operating as the legal entity. Be sure to notify individuals according to the directives of the originating documents.

Having an annual meeting is much more than a meeting of people. To be successful, positive and productive, there must be much individual preparation and planning followed by specific assigned action so that when the meeting is held, all are prepared. That’s how you honor the family by doing the business right.

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