Livestock Marketing Association 7509 Tiffany Springs Parkway, Kansas City, MO 64153 800-821-2048 816-891-0502 Fax: 816-891-7926 Email: lmainfo@lmaweb.com

Questions related to Packers and Stockyards Act requirements associated with the "Lamb Assessment" program should be directed to Timothy Hansen, Grain Inspection, Packers and Stockyards Administration, Packers and Stockyards Programs, at 202-690-3209. Packers and Stockyards Act requirements are discussed below.

Record Keeping

• The Packers & Stockyards Act requires that packers, stockyard owners, market agencies, and dealers keep such accounts, records, and memoranda as are necessary to fully and correctly disclose all transactions involved in the business of their firms.
• When a packer, market agency or dealer deducts an assessment under the Lamb Promotion and Research Order (Assessment) from the amount paid to a sheep seller, the accounting provided the seller must clearly show the gross sale amount and all charges deducted from those proceeds, including the Assessment.
• Invoices issued to sheep buyers by market agencies and dealers must show the gross purchase amount and the Assessment deduction (credit). Showing only the net amount to be paid by the buyer on the purchase invoice is insufficient.
• Accounts of sale and invoices issued by packers, stockyard owners, market agencies, and dealers must clearly show the deduction is for the "Lamb Assessment," or show some similar identifying designation.

Accounting

• Some market agencies selling on commission (selling agencies/auctions) have automated accounting systems that do not readily allow the market to apply a deduction or credit amount to the purchase invoices issued to buyers.
  • Selling agencies can reprogram their software to allow for the issuance of purchase invoices showing the properly designated "Lamb Assessment" credit.
  • In the alternative, selling agencies can print purchase invoices showing only the gross sale amount. Prior to issuing the purchase invoices the selling agency must manually record the "Lamb Assessment," and the net amount to be paid by the buyer on the individual or recap purchase invoices. This will provide the buyer with a written record of the Assessment credit received.
    • If the buyer then pays the net sale amount that is manually recorded on the purchase invoice, the selling agency must make an accounting adjustment to eliminate the excess receivable (the difference between the gross sale amount entered in the system, and the net amount received from the buyer) to balance the account.
    • The selling agency also has the option of billing the buyer the gross amount of the lamb purchase, then issuing a custodial account check for the Assessment credit. The custodial account would then be in balance for the transaction.

Posting the "Lamb Assessment" Rates

• There is no requirement under the Packers and Stockyards Act that the "Lamb Assessment" be included in the selling agency's schedule of charges (tariff) for its selling services. The "Lamb Assessment" may be included in the tariff at the option of the selling agency.