P.I.S.O

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Financial Ratios for Philippine Cooperatives

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P.I.S.O

  1. 1. P.I.S.O. • Net Institutional Capital • Adequacy Provisioning jobitonio O • Non Earning Assets to TA • Member’s Equity to TA • Deposit Liability to TA • External Borrowings • Receivable to TA Operational Strength S Structure of Assets • Profitability Ratio • Earning per Share Ratio • Profitability Growth Rate • Asset Efficiency Rate • Rate of Interest on Share Capital I Institutional Strength Profitability Performance P • Volume of Business to TA • Solvency • Liquidity • Cost for Volume of Business • Administrative Efficiency • Turn Over Ratio
  2. 2. jobitonio Rate of Interest on Share Capital Asset Efficiency Rate Profitability Growth Rate Earning per Share Ratio Profitability Ratio Profitability Performance
  3. 3. Profitability Ratio: Standard 30% and above 10% to below 25% 3 2 Below 5% In case of break-even or net loss jobitonio 4 5% to below 10% Gross Revenue / Gross Margin 5 25% to below 30% Net Operating Surplus 1 0
  4. 4. Earning per Share Ratio: STANDARD Net Surplus jobitonio 5 Zero or negative Paid-up Capital / Par Value Php 2.50 and above Php 2.00 to below Php 2.50 Php 1.50 to below Php 2.00 Php 1.00 to below Php 1.50 1 4 3 2
  5. 5. Asset Efficiency Rate Net Surplus Total Assets 20% and above 15% to below 20% 10% to below 15% 5% to below 10% below 5% jobitonio 5 4 3 2 1
  6. 6. Rate of Interest on Share Capital Amount Allocated for Interest on Share Capital Average Paid up Share Capital jobitonio Higher than the inflation rate Within the inflation rate 2 points below the inflation rate 3 points or more below the inflation rate Net Loss 5 4 3 2 1
  7. 7. Institutional Strength Net Institutional Capital Adequacy of Provisioning (more than 1 year) Adequacy of Provisioning (31 days to 1 year) jobitonio
  8. 8. Net Institutional Capital Formula: (Reserves + Allowance for probable losses on loan and or actual receivables) (Problem receivables asset + past due receivables under litigation+ restructured receivables) 10% and above 8% to below 10% 6% to below 8% Total Asset 4% to below 6% 2% to below 4% Below 2% Zero or negative jobitonio
  9. 9. Adequacy of Provisioning (more than 1 year) Allowance for probable losses on loans and account receivables Past due receivables one year and above jobitonio 100% and above 90% to below 100% 70% to below 90% 50% to below 70% 30% to below 50% 10% to below 30% Below 10% Zero or negative
  10. 10. Adequacy of Provisioning (31 days to 1 year) Allowance for probable losses on receivables-allowance required for past due receivables one year 35% and above and above 30% to below 35% 25% to below 30% Total past due receivables 20% to below 15% 31 days to 1 year 15% to below 20% 10% to below 10% Below 10% but not zero or negative jobitonio
  11. 11. Percentage of NonEarning Asset to Total Assets Members' Equity to Total Assets Deposit Liabilities to Total Assets External Borrowings Receivables to Total Assets jobitonio
  12. 12. Percentage of Non-Earning Asset to Total Assets Non-Earning Assets Total Assets 10% and below 5 Above 10% to 20% 4 Above 20% to 30% 3 Above 30% to 40% 2 Above 40% 1 jobitonio
  13. 13. Members' Equity to Total Assets Paid-up Share Capital+Deposits for Capital Subscription 40% to below 50% 50% to below 60% Total Assets 30% to below 40% 60% to below 70% 20% to below 30% Below 20% or above 70% Less than 20% jobitonio
  14. 14. Deposit Liabilities to Total Assets 30% to 40% Above 40% to 50% 20% to below 40% Above 50% to 60% Below 20% to 10% Above 60% to 70% Below 10% to 5% Above 70% Below 5% Total Deposit Liabilities Total Assets jobitonio
  15. 15. External Borrowings Total External Borrowings Total Assets No external borrowings 1% to 20% Above 20% to 30% Above 30% to 40% Above 40% 5 4 3 2 1 jobitonio
  16. 16. Receivables to Total Assets Loans and/or accounts receivables Total Assets 60% to 70% 55% to below 60% 50% to below 55% 45% to below 50% 40% to below 45% jobitonio
  17. 17. Volume of Business to Total Assets Solvency Liquidity Operational Strength (Staying Power) Administrative Efficiency Account Receivable Turn-over jobitonio Accounts Receivables Turn-Over:
  18. 18. Volume of Business to Total Assets 100% and above 75% to below 100% 50% to below 75% 25% to below 50% 5% to below 25% Less than 5% Total Volume of Business Total Assets Credit Loans released, consumed/Produced /Marketing, Sales, Service, Service Income jobitonio
  19. 19. Solvency (Assets + Allowance for Probable Losses)-(Total Liabilities-Deposit Liabilities)+ (Past Due receivables+ restructured receivables+receivables under litigation) Deposit Liabilities Share Capital 110% and above 100% to below 110% 85% to below 100% 75% to below 85% 50% to below 75% Less than 50% jobitonio
  20. 20. Liquidity Liquid Assets - Short term Payables 15% and to 30% Below 15% to 10% Above 30% to 50% Below 10% to 5% Above 50% to 60% Below 5% to 1% Above 60% to 80% Above 80% or below 1% Zero or negative Total members' Deposit jobitonio
  21. 21. Cost for Volume of Business Operating Cost - (members' benefit expense+ social service expense) Total Volume of Business 25 cents and below 26 to 32 cents 33 to 39 cents 40 to 46 cents 47 cents and above 5 4 3 2 1 jobitonio
  22. 22. Administrative Efficiency Administrative Cost(members' benefit expense+ social service expense) 10% and above 5 Above 10% to below 15% 4 Average Total Assets Above 15% to below 20% 3 Above 20% to below 25% 2 Above 25% jobitonio 1
  23. 23. Turn- Over Ratio(Note: Get the Average, if both formula is applicable) Account Receivable Turn-over Net Credit Sales Average Accounts Receivables jobitonio 4 times and more 3 to below 4 2 to below 3 Below 2 Zero or negative 5 4 3 2 1
  24. 24. Accounts Receivables Turn-Over Total Loans releases 4 times and more Average Loans Receivables 3 to below 4 2 to below 3 Below 2 Zero or negative jobitonio
  25. 25. If multi-purpose cooperative add the rating of accounts receivable turnover and loans receivable turnover and divide by 2 to get the average. For single type select whatever is applicable to the coop. jobitonio
  26. 26. Summary of Financial Ratios Profitability Performance Institutional Strength Structure of Assets Operational Strength jobitonio ________ ________ ________ ________

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