1921.] The Control of Fap.m Mamacement. 227 



of production without the means of examining and testing the 

 application of his technical ability. 



The basis for any system of management book-keeping for the 

 farm is the Valuation, and more errors in costing spring from 

 false principles in this matter tluin from any other cause. In 

 industrial undertakings the position luis been established firmly 

 and clearly enough. With rare exceptions the principle is to 

 value plant at cost, less depreciation ; to value i);oods in the pro- 

 cess of manufacture at cost ; and to value manufactured stock at 

 cost, or at cost or market-value, whichever be the lower. In 

 agriculture the position is equally clear and definite, and it is 

 the almost universal practice to value practically everything at 

 market price. The explanation of this difference in practice is 

 that in farming there is not the sharp line of demarcation 

 between plant and product that exists in other forms of industry. 

 A ewe may be regarded as a machine for the manufacture of meat 

 and wool, but it is a machine w-hich, in due course and before 

 very long, itself goes to market as a commodity. Indeed, the 

 amount of working capital invested in the farm in plant and 

 equipment of a permanent or semi -permanent nature bears a 

 very small proportion to the total capital, and the fact that the 

 bulk of the " machinery " for production will itself be placed 

 on the market, combined with the fact that costs of products in 

 the process of manufacture are never available, has led to this 

 difference of principle in making valuations on the farm as con- 

 trasted with the other forms of industry. It must be remem- 

 bered, however, that although the ew^e and the cow^ fulfil their 

 purposes of mannfactiiring animal products for the market for 

 a short time only, and are then themselves :narketed, the flock 

 and the herd remain, and it is these rather than their individual 

 members which must be regarded as constituting the producing 

 plant, and their valuation should remain at a figure constant 

 from year to year, except in so far as this sum is affected by 

 changes in the total numbers of the flock or herd for the year. 

 Regarded in this way there is no longer the difference between 

 the productive machines of the factory and those of the farm, and 

 the valuation of the latter can and should be made on the same 

 basis as that of the former. Thus, the valuation of flocks and 

 herds is a matter of numbers only, the value per head, based 

 on the cost or estimated cost of the animals, being kept at a con- 

 stant figure from year to year. Depreciation, which is neces- 

 sarily deducted in the case of dead stock used in the processes of 

 production, does not enter into the annual valuation of liv(^ stock, 



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