Succession planning is a negotiation between two generations, who often have different views of the future.
It is important to ensure each party’s objectives are clear and that a succession plan meets all parties’ needs.
Advisory Partner has assisted a rural family with a resolution to a complex dilemma about who runs the properties when the parents are ready to scale back their busy lives.
The Worsfold family has a successful cattle agribusiness near Wandoan on Queensland’s Western Downs, 280km north of Toowoomba, which the parents have worked hard to build. Their two sons worked in the business, but the family members had different perspectives on its future.
The resolution was that David Worsfold, the elder son, and his wife, Sharna, are now separate from the original family enterprise and lease one of David’s parents’ six properties, Kimberley.
David and Sharna run 300 head of breeders and 200 head of dry cattle (heifers and steers) on almost 5,000 acres.
It’s what David describes as “a good fattening block”. With plenty of rain, they’ve had a good season, but that also means cattle are expensive and the couple is keen to get their property to full capacity.
Farming is a struggle, but Sharna says: “We’ve got to make it work.” She and David have daughters Rainey, 4, and Darcee, 2, and their futures to think of.
The couple is full of praise for Advisory Partner director Brett Plant, who was recommended through their rural networks. “We needed an accountant and someone to help us set up our business partnership. Brett is amazing; he’s helped us so much,” Sharna said.
Brett assisted with commercial negotiations and a tax structure for David and Sharna to move forward. “In resolving a succession plan there are complex tax and financing issues when you are talking about multi-million-dollar farming operations,” he said.
David said: “Brett is dedicated to getting the best outcome. He explained everything to us, so we understood both sides of the discussions. He’s always in our corner.”
The pair appreciate Brett’s “deep understanding of fairness”. His own rural background, having grown up in country Queensland, means he knows what life on the land is like.
The Worsfolds and Brett agree everyone in the rural sector needs to have better conversations about succession planning.
Brett says: “Over the years, I’ve seen a great deal of distress with poorly managed succession plans. I’ve met the children of farming families who’re now in their 50s and have no certainty after working hard all their lives.
“It can be fractious for families, which means everyone loses. You can’t park succession planning in the too-hard basket and think it won’t matter. You wouldn’t do that on your farm so don’t do it with your succession plan.”
Sharna says poor succession planning undoubtedly contributes to depression among many in rural communities and she’s keen to encourage open, fruitful discussions to avoid families being torn apart.