Livestock Trading Guide

This guide explains how to configure and manage Livestock Trading within Compass Forecasting. Whether you are managing cattle, sheep, or other livestock, Compass Forecasting provides specialized tools to handle the unique accounting requirements of agricultural trading, including stock movements, natural increase, and mortality.

1. Enabling Livestock Trading

Livestock Trading features are hidden by default to keep the interface clean for non-agricultural businesses. To enable these features:

1. Open the Wizard from the main sidebar menu.
2. Navigate to Step 2: Account Mapping.
3. Toggle the Livestock Trading switch to the ON position.

Note: Once you map an account to a Livestock category, this toggle will automatically lock in the ON position. It cannot be turned off until all livestock accounts are unmapped.

2. Mapping Livestock Accounts

When Livestock Trading is enabled, new categories will appear in the mapping dropdowns. It is crucial to map your Xero accounts correctly to ensure the Cash Flow Worksheet and generated reports calculate cost of sales and inventory correctly.

You should map your relevant Xero accounts to the following Livestock categories:

• Livestock Sales (Revenue): Income from selling livestock.
• Livestock Opening Stock (Direct Costs): The value of stock at the beginning of the financial year.
• Livestock Purchases (Direct Costs): The cost of buying new livestock.
• Livestock Rations (Direct Costs): Optional. Feed and other direct costs associated with raising the livestock.
• Livestock Closing Stock (Direct Costs): The value of stock at the end of the period.
• Livestock Inventory (Current Asset): The balance sheet account holding the total value of stock on hand.

3. Managing the Livestock Schedule

Once your accounts are mapped, you need to provide the system with your forecast numbers for livestock movements.

Accessing the Schedule

You can access the Livestock Schedule dialog from two places in the sidebar:

1. In the Generate Reports view, click the Manage Livestock Schedule button (located above the scenario selector).
2. In the Cash Flow Worksheet view, click the Manage Livestock Schedule button (located beneath the Manage Account Settings button).

Tip: These buttons will only appear if you have successfully mapped at least one account to a Livestock category in the Wizard.

Using the “Add Class” Feature

The Livestock Schedule allows you to segment your stock into different “Classes”. A class represents a specific grouping of animals that you want to track separately.

When you click Add Class, you can create a new segment.

• Simple Forecasting: If you do not need detailed tracking, you can simply create a single class called “Cattle” or “Sheep” and enter your total numbers there.
• Detailed Forecasting: For more granular control, you can create multiple classes such as “Breeding Cows”, “Steers”, “Heifers”, and “Calves”.

For each class, you will enter monthly quantities for:

• Opening Head Count (Auto-calculates after the first month)
• Natural Increase (Births)
• Purchases
• Sales
• Deaths / Missing
• Rations
• Closing Head Count

The system uses these head counts, along with the average values you specify, to automatically calculate your closing stock valuation and project the movements on your Profit & Loss and Balance Sheet.

4. Validation and Integrity Procedures

Because livestock accounting relies on the equation Opening Stock + Purchases + Natural Increase - Sales - Deaths - Rations = Closing Stock, Compass Forecasting includes validation checks to ensure your data is balanced.

• Closing Stock Balances: When generating reports, the system ensures that the Closing Stock value on your Profit & Loss exactly matches the movement in the Livestock Inventory account on your Balance Sheet.
• Integrity Checks: If the numbers you enter in the Livestock Schedule do not reconcile mathematically, the system will flag this in the Integrity Check report. You can view the Integrity Check report by clicking the shield icon in the top right of the Generate Reports screen.

Important: To ensure your historical/actuals data provides an accurate starting point for forecasting, you must ensure that manual journals for closing stock valuations have been correctly processed in Xero up to your forecast start date.