Having a plan is crucial
IT CAN be a touchy and daunting subject, but it’s one of the most important things for farmers to consider.
Succession planning is crucial for the future of any family property.
Moore Stephens succession planning accountant Rebecca Murray has been involved with the agricultural industry for 17 years.
She has sat around the table with farmers as they work through the complex and taxing issue of handing on the reins of their business.
She said the golden rule for succession was to “never assume”.
“It’s such a personal thing and sometimes what mum and dad think the kids want, or vice versa, can come as a bit of a shock,” Ms Murray said.
“It’s a question that doesn’t really get asked.”
Ms Murray admitted the process could seem unsettling from the onset.
“I think farmers worry about fairness and trying to make succession equal between their kids,” she said.
“If there’s one property and three kids they begin to think ‘how can I give them all something fair?’.
“I think they also worry about conflict between siblings and don’t want the family to bust up.”
Ms Murray said the first and easiest thing people can do was get early advice.
“Talking to a trusted advisor is one of the first things people should do,” she said.
“Also getting the entire family involved and communicating makes the process easier.”
She said producers could arrange their plans periodically.
“It’s worth going through it in different stages because it can be daunting,” she said.
“It’s not handing everything over tomorrow, it’s about putting a plan in place for the future with guidelines of where you’re heading with business and family.”
Each family business is different, so each succession planning process can vary.
“Most families have ideas or parts of a plan in place,” Ms Murray said.
“We provide them with other options or ideas that they haven’t considered.
“We talk them through all the options and include the accountants, bankers and solicitors so that everyone can contribute and work out the plan that best suits the family’s needs and what they are trying to achieve in the short, medium and long term.”
Ms Murray said she couldn’t stress enough how important it was to have a plan in place.
“It’s all about having that clear communication so there’s no confusion down the track,” she said.
“It sets everything up for the future generation and where they’re going.”
Sometimes what mum and dad think the kids want, or vice versa, can come as a bit of a shock. — Rebecca Murray