Statutory compliance risk arises from failure to follow regulations governing the operation of the business. The types of regulations facing today’s agricultural operations seem to be constantly increasing. In addition, they span many different aspects of the operation, from nondiscrimination in employee management to Federal crop program compliance issues.

Many businesses have developed to provide assistance to agricultural managers in managing this type of risk. Tax preparation services, pesticide/herbicide application companies, employee location services, etc., can all provide a service to agriculturalists willing to pay. In addition, they provide a mechanism for spreading some of the risks of statutory compliance.

Keep in mind that although the sheer number of regulations governing how you run your farm or ranch may appear too intimidating to tackle, ignorance and the resulting non-compliance can result in severe fines or other penalties.