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Archive for June, 2016

Part one of two.

As of July 1st 2016 all employers in Ontario, including farmers, are required to comply with new workplace noise regulations under the Occupational Health and Safety Act. The legislation states that farmers and other employers shall ensure that their employees are not exposed to hazardous levels of noise. Hazardous noise, according to the legislation, is 85 dBA or louder, for a time period of approximately eight hours. Examples of 85 dBA are illustrated below.

This legislation does not apply to self-employed farmers with no employees.

 

What this Means to Farmers

This results in additional responsibilities for farmers to ensure safe working conditions for their employees.

Key changes:

  • Farmers shall take reasonable measures for the circumstances, to protect workers from exposure to hazardous sound levels.
  • Noise protective measures may be engineering controls (altering work environment), work practices and, where required and permitted, hearing protection devices.
  • Measurements of sound levels in the workplace (for the purpose of determining appropriate protective measures) shall be done without regard to the use or effect of hearing protective devices.
  • Employers should ensure that workers are not exposed to hazardous sound levels of 85 dBA, for eight hours.
  • Except for certain circumstances, employers shall protect workers from exposure to hazardous sound levels without requiring workers to wear hearing protective devices.
  • Protective hearing devices are not to be used as a primary means of protecting hearing only in the certain circumstances listed below.
  • Where practicable, clearly visible warning signs shall be posted at every approach to an area in the workplace where the sound level regularly exceeds 85 dBA.

 

The Use of Hearing Protective Devices

Hearing protective devices shall be used if other forms of protection such as modifying equipment, absorbing noise, or changing frequency of noise cannot be achieved due to:

  • not in existence or are not obtainable;
  • not reasonable or not practical to adopt, install or provide because of the duration or frequency of the exposures or because of the nature of the process, operation or work;
  • rendered ineffective; or
  • are ineffective to prevent, control or limit exposure because of an emergency.

 

Training and Instruction on the Use of Hearing Protective Devices

If hearing protection devices are provided employers shall also provide adequate training and instruction on the care and use of the device including its limitations, proper fit, inspection and maintenance and if applicable the cleaning and disinfection of the device.

 

 

Selecting Hearing Protection Devices

When selecting hearing protection devices consider:

  • sound levels to which a worker is exposed;
  • the reduction provided by the device; and
  • The manufacturer’s information about the use and limitations of the device.

A hearing protection device shall be used and maintained in accordance with the manufacturer’s instructions.

 

Summary of Changes 

In situations where noise levels are hazardous farmers shall consider the particular circumstances of the situation and use engineering controls, safe work practices and in certain circumstances, provide employees with proper hearing protection devices and necessary training for how to use.

 

http://www.labour.gov.on.ca/english/

https://www.ontario.ca/laws/regulation/r15381

 

 

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Continuing a long standing trend with custom farmwork, 2015 custom rates rose from the previous report in 2012. Figure 1 shows an example of grain corn combining rates from 1994 to 2015. Combining rates have been on a steady increase over the past 20 years, which is true of most field crop operations. Overall, per acre rates increased 8.5% across all operations from 2012 to 2015, a 2.8% increase per year.

Figure 1: Grain Corn Combining Rates

Hiring custom farmwork allows farm managers to purchase fieldwork and other services instead of owning the equipment and doing the work. For equipment owners, providing custom farmwork services can be the focus of a business, a sideline farming enterprise that spreads equipment ownership costs over more acres, or a marketing tool to complement the sale of other farm inputs.

Every three years custom farmwork operators in Ontario are asked what they charged for custom farmwork operations. The results are reported in the Survey of Ontario Custom Farmwork Rates Charged in 2015. Averages shown in the tables of this report are a simple average of the rates charged in 2015 across Ontario. There is no assurance that using the average rates reported will cover the cost of providing the service. Before setting prices for yourself, carefully calculate all your costs and returns.

An interesting side note on demographics, in 1994 a total of 772 custom operators responded compared to 220 in 2015. There are fewer custom operators now just as there are fewer farmers.

The custom rate year over year increases may not be as high as one would expect given that machinery prices and costs in general have increased at higher rates. There could be a number of reasons for that including sample size changes over time, it is not always the same custom operators included in summary and custom operator supply and demand factors. Another possible reason could be the size of equipment they are operating and how many acres they are covering. Machinery size has been increasing over time, and covering more acres will spread the fixed costs of the machinery over more acres. For example, in 2006 the common corn planter size was 8 rows and in 2015 it was 12 rows. The work rates increased from 8 acres per hour to 10 acres per hour from 2006 to 2015. Custom operator machine size data is not available for years earlier than 2006 but the trend of increasing machinery size over time would likely hold true.

The costs to own and operate machinery are increasing and custom rates reflect this. Table 1 shows the increase in custom rates for grain corn operations from 2009 to 2015. Rates increased $12 – $13 or 8% between each survey period. It’s important to know your machinery costs to help you make the decision whether owning your own equipment or hiring custom operators is the best option.

Table 1. Custom rates comparison

Corn operations 2009 2012 2015
Plow
$24
$25
$29
Cultivation (2x)
$24
$26
$28
Plant
$19
$22
$22
Spraying
$9
$9
$10
Fertilizing
$8
$8
$9
Harvest
$40
$42
$44
Trucking
$32
$32
$35
Total
$152
$164
$177

The OMAFRA Factsheet Guide to Custom Farmwork and Short-term Equipment Rental provides decision-making tools for farm managers and custom farmwork operators to manage the use of equipment and work time to meet production and profit goals. There are also Excel-based Farm Business Decision Calculators to help calculate custom farmwork and short-term equipment rental rates.

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So, you’ve decided you want to become a farmer.

There are many things you need to think about when starting a farm. Some of these things are what do you want to produce, where are you going to produce it, how are you going to gain the skills to do so, and how are you going to finance this initiative?

Very few people who are starting a farm from scratch have the disposable income to get an operation up and running, and keep it going all on their own. So where do you find financing?

Aside from friends and family, the obvious choice would be your financial institution. Most banks and credit unions have agricultural specialists that deal with just this sort of thing. They have the knowledge, and expertise to help guide you through the process of securing the necessary funds to match your business needs.

In addition to the traditional banks, there are also lending institutions that specifically focus on the agricultural community. These funding sources tend to offer more specialized financial services to their clients. A couple of examples would be Farm Credit Canada and the Agricultural Credit Corporation (specific to operating costs), both prominent lenders to farm and farm-related businesses in the country.

Depending on where you are at in your business’s lifecycle, you may also be eligible for funding through various government programs. While the government is generally not in the business of providing funding for farming start-ups, there are a number of cost-share programs that support new initiatives that focus on job creation, innovation and economic development. Some examples of these programs are the Jobs and Prosperity Fund, Growing Forward 2 and various grants offered by the Ontario Trillium Foundation.

Another source of funding that is growing in popularity is crowdfunding. This method relies on donations or offering rewards. The rewards would most likely be directly related to the product or service your farming venture would produce. While this method may seem like a means of getting “free money”, it is considered taxable income, and does require a significant amount of project management to get your funding campaign off the ground, promoting it, and delivering on commitments after your campaign is complete. Additional information on the legalities of crowdfunding for a business, especially when it comes to equity crowdfunding, is available through the National Crowdfunding Association of Canada.

Whatever source of funding you decide to pursue for your new farming business venture, always make sure you do your homework and are aware of the risks involved. Having a solid business plan is the best place to start to ensure you are prepared for what you want to do, and how you’re going to do it when it comes to starting your farm business.

 

Visit Ontario.ca/agbusiness for more information.

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Windbreaks can increase crop yields up to 15 per cent, more than making up for the amount of land they use. How? Windbreaks improve a field’s microclimate by reducing wind speeds, increasing temperatures and reducing the amount of moisture loss.

Have you considered planting a windbreak? Windbreaks can also:

  • reduce soil erosion
  • decrease odour and spray drift
  • offer alternative income options
  • save you up to 30 per cent in heating and energy costs
  • shelter livestock from the wind and sun

windbreaks

Graph: Each bar represents yield average, as studied by the University of Guelph Ridgetown Campus. Yields increased on the downwind side of the windbreak over distances of up to 12 times the height of the windbreak.  Crop yield increases vary by crop type. Taken from Establishing Tree Cover.

 What are the costs associated with planting windbreaks?

There are costs when planting a windbreak, such as site preparation, purchasing the trees and planting. Some conservation authorities in Ontario have cost-share programs that can help you with these costs. Contact your local conservation authority to see how they can help you plan and plant a windbreak.

What type of windbreak should you plant?

The type of windbreak you plant and how you plant it depends on the purpose for the windbreak.

  • One to three rows of trees are most often planted to protect field crops from the wind and to reduce soil erosion. Multiple row windbreaks often include at least one row of conifers.
  • Think about planting at least one row of hardwood trees for future alternative income sources, such as wood for fence posts, fuel and lumber.
  • Plant a shelterbelt (more than three rows of trees) around your home and farm buildings to save on energy costs.
  • Plant a conifer windbreak to provide livestock with wind and sun protection.
  • Windbreaks deflect odours upward if properly situated to the barn.
  • The taller the windbreak, the greater the area it protects. Consider the maximum height of the tree species you choose and determine if it will provide you with the protection you need.
  • Keep in mind the crops that you plan to plant beside the windbreak, and the winter hardiness and typical lifespan of the selected tree species.
  • Some trees may be better suited for areas with tile drains than others, an important, and potentially money-saving, consideration.

The type of soil of your land and the region of the province you’re in will also affect the type of trees you can plant. Trees can thrive and provide maximum protection when they’re matched with the right soils. Visit the Ministry of the Environment and Climate Change’s Tree Atlas to determine the best trees for your situation.

Need help?

For help with planning and planting a windbreak, contact your local conservation authority. They may be able to visit your planned windbreak site and help you with your planting plan, site preparation, choices of tree species, and appropriate spacing and planting, as well as windbreak maintenance.

The Ministry of Agriculture, Food and Rural Affairs (OMAFRA) has many resources to help you with windbreak planning. Visit our website to watch four windbreak videos on planning, planting, maintenance and farmer windbreak success stories. Our free Best Management Practices book, “Establishing Tree Cover,” provides a step-by-step guide for planning and planting a windbreak and includes maintenance tips. Contact OMAFRA’s Agricultural Information Contact Centre at 1-877-424-1300 or ag.info.omafra@ontario.ca for more information.

 

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The Ontario government wants your help to identify opportunities to grow the Agriculture, Aquaculture and Food Processing sector in Northern Ontario.  Tell us your ideas on how industry and government can work together to drive growth of the sector.

The Growth Plan for Northern Ontario identified the Agriculture, Aquaculture and Food Processing sector as one of eleven priority sectors that can contribute to the diversification and growth of the Northern Ontario economy.  The Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) is developing a strategy for growing the sector and has posted a discussion paper to its website and to Ontario’s Environmental Registry.

Your ideas are important to the development of a strategy for the sector. First, read the discussion paper .

Then, share your ideas with us in one of several ways listed below. Comments must be submitted by July 3, 2016.

Economic Development Policy Branch

1 Stone Road West

2nd Floor NE

Guelph, Ontario

N1G 4Y2

  • By Fax: (519) 826-4328 (addressed to the Economic Development Policy Branch, OMAFRA)

OMAFRA will develop a strategy for the Agriculture, Aquaculture and Food Processing sector based on the ideas generated at meetings and comments submitted to the ministry by July 3, 2016.  The strategy, along with other plans and strategies for Northern Ontario, can be expected to drive policies, programs and investments in Northern Ontario over the next 20 years.

In addition, OMAFRA will follow up with willing proponents on promising opportunities to understand how the government can help them move forward with their plans.

If you have any questions, please contact northernagrifood@ontario.ca

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June 15th is the deadline for the self-employed to file income taxes. As the date rapidly approaches, many people are starting to head to their friendly accountant, shoebox in hand. One of the first questions the friendly accountant may ask is, ‘what type of work are you looking for?’ and will you be able to answer that question?

Professional accountants refer to the work they perform for a specific client as an engagement. It is helpful to understand the options available when asking an accountant to prepare financial statements and perform an engagement. Clients can select from a number of different engagements and the accountant will often help determine which one best suits their specific needs.

There are three different engagements associated with the financial statements of a business:

  1. Audit Engagements
  2. Review Engagements
  3. Compilation Engagements

 

Audit Engagements

The objective on an audit engagement is to enable independent professional public accountants to render an opinion on the fairness of the client’s financial statements.

Audited financial statements are the accepted means which many business corporations report to shareholders, to bankers, to creditors and to government. Federal and provincial legislation in Canada generally requires a limited company (corporations) to prepare annual financial statements for audit by qualified independent auditors.

The financial statements subject to audit are the responsibility of the company’s management. The auditors’ responsibility is to express an opinion on those financial statements. The auditors must plan the audit to obtain reasonable assurance that the financial statements are free of material misstatement. Through the study and evaluation of the company’s system of internal control, and by inspection of documents, observation of assets, making enquires within and outside the company, and by other generally accepted auditing procedures, the auditors will gather evidence necessary to determine whether the financial statements present a fair picture of the company’s financial position and its activity during the period being audited.

Review Engagements

The objective of a review engagement is to prepare and review financial statements to ascertain whether they are plausible, that is, worthy of belief. If, after reviewing the financial statements the accountants are satisfied that the financial statements are not misleading, the accountants’ standard report will preface the financial statements.

Where an audit is not required or the shareholders have waived the appointment of an auditor, financial statements may be prepared on a review basis. Reviews provide limited assurance that the financial information confirms to generally accepted accounting principles.

In performing a review the accountants would must be independent from the clients and have sufficient knowledge of the industry which the business operates. They would acquire sufficient knowledge of the client’s business to make intelligent enquiry and assessment of the information obtained, with the limited objective of determining the plausibility of the information reported on. The review should entail enquiries, analytical procedures and discussion with responsible client officials.

This degree of assurance is less than that resulting from an audit and is expressed as either:

  • The negative assurance that nothing has come to the accountants’ attention that would indicate the financial information is not presented in accordance with generally accepted accounting principles, or
  • A reservation together with appropriate disclosure and explanation of the reservation.

Compilation Engagements

The objective of a compilation engagement is to compile unaudited financial information into financial statements, schedules or reports based on information supplied by the client.

A compilation engagement is appropriate only where the client and other users do not need financial information that conforms in all respects to generally accepted accounting principles and audit or review assurance is not required, and where the client understands that the statements may not be appropriate for general purpose use.

The procedures performed are not designed to enable accountants to provide any assurance on the reliability of the compiled information. To warn readers of this lack of assurance, accountants attach a “Notice To Reader” that states that no review was performed on the information (as above) and that the information may not be appropriate for use by the reader. If accountants know, or have reason to believe financial statements are misleading or incorrect, they must not associate with this information. A compilation may be applicable where financial statements are prepared for the exclusive use of the company’s management or for income tax purposes.

 

Financial Management:

http://www.omafra.gov.on.ca/english/busdev/finance.html

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