Last week our partner in this column shared the relevance of planning to an organization and to an individual. He mentioned that it is one of the responsibilities of the Board of Directors (BODs) aside from direction setting. Allow me then to introduce the Performance Report Standards for Cooperatives (CDA M.C. 2013-15 that was approved by the CDA Board of Administrators last February 7, 2013. Discussing this issuance will further enlighten us on the different plans and areas of concern that needs to be considered in the conduct of strategic planning to come up with a comprehensive development program for the cooperative. Also, expressly provided is the oversight function pf the BODS is governance function to review, monitor and supervise the cooperative’s programs, activities and policy implementation.
Moreover, the performance audit shall be performed by the Internal auditor/Compliance Officer or Audit Committee on the cooperatives’ performance in reference to the organizational, economic and the social aspects of the cooperative.
Anchored on the provisions of Article 53 and Article 80 of RA 9520 and its Implementing Rules and Regulations, Section 4 of this circular states the purpose of this circular that is “to serve as a regulatory tool of CDA in programming the roadmap of developmental intervention for cooperatives and as a management tool of cooperative for the purpose of identifying problem areas in the operation and determining the state of the cooperative’s health”.
Section 5 also mentions that these guidelines shall govern all registered cooperatives regardless of types and categories. Scope of Performance Audit shall be include: a) Evaluation of the leadership, human resource management, members, structure and system and mechanism within the cooperative; b) Examination on the adequacy of internal control system; c) Appraisal of financial performance using PISO as standards, and d) Assessment of the Social Development Plan and the utilization of Community Development Fund (Section 6). Also, Section 8 provides that the Internal Auditor or in his/her absence the Audit Committee shall conduct and accomplish the performance audit.
The Performance Report Questionnaire covers 4 components that include Basic Information, Non-financial, Financial, and Rating System. In the presentation of the performance audit report, Section 10 of this circular states that shall at least include the following parts: a) Executive Summary – presents the overview of the objectives and scope of the audit, and the summary of the key observations and conclusions together with the key recommendations identifying the strong points and main areas which need to be addressed by the cooperative; b) Objectives and Scope of the Audit- presents the objectives set and brief scope of audit including the actions chosen for audit and broad details of the the procedures carried out; c) Observations and Findings- presents a clear and logical analysis of the identified strong points or problems confronted by the cooperative within the audit period. The report should provide sufficient details of the observations and findings to substantiate the points given;d) Recommendations-presents the specific recommendations for action by the cooperative either to sustain current practice or to address the weaknesses found. This part should be clear and precise on the need for appropriate action to address the issue. The recommendation shall form as basis for any follow-up audit, evaluation or examination.
Given the above provisions, the significance of planning plays a vital role in cooperatives. One of the cited plans is the social development plan. Social development plan as defined in this circular refers to the written plans of the cooperative regarding its program on social services for the members, the cooperative movement and the community and/or nation. During our visits to some cooperatives, staff and officers raise some queries on the details that can be included in the social development plan.
As broadly defined above, I encourage that under social aspects programs on health assistance, education (i.e. scholarship assistance, OJT, etc.), Mutual Aid, Elderly/PWDs, Youth, Women and Children be included in the planning. Under economic programs, the livelihood activities of members must be considered in the formulation of plans to ensure that adequate support be extended. Support to livelihood activities of non-members in the community can also be undertaken that will strengthen the relationship of the cooperative with the community where it operates. While some cooperatives would like to reach out to communities outside their areas of operation, it is our impression that attending to the needs of our neighbors should come first. I don’t mean it is not good to help others outside the cooperative operation but we should bear in mind that self-help is one solid foundation for cooperatives to prosper.
To be continued…
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