SlideShare a Scribd company logo
Operation & Managemen
of the Cooperative
Importance of
Financial
Management,
Human Resource
(Personnel
Management),
Marketing, Production
or Technical aspects
Allocation and
distribution of net
surplus
Overview of
Ethical
Standards in
Cooperatives
Performance and Measurement
(balance scorecard)
1
2
3
4
Management
Financial
It means planning, organizing,
directing and controlling the
financial activities such as
procurement and utilization of
funds of the enterprise. It
means applying general
management principles to
financial resources of the
enterprise
• Involves setting financial goals and analyzing data to
accomplish the objectives of the organization.
• It is the strategic planning of how a business should earn
and spend money (10-15% of your Ave total Assets)
• It includes decisions about raising capital, borrowing
money and budgeting.
Financial Management
2. Determination of capital
composition: Once the
estimation have been made,
the capital structure have to
be decided. This involves
short- term and long- term
debt equity analysis. This will
depend upon the proportion of
equity capital a cooperative is
possessing and additional
funds which have to be raised
from outside parties.
(100 – 150 % liquidity)
Functions of Financial
Management
1. Estimation of capital
requirements: A finance manager
has to make estimation with
regards to capital requirements
of the cooperative. This will
depend upon expected costs and
profits and future program and
policies of a concern. Estimations
have to be made in an adequate
manner which increases earning
capacity of enterprise.
Objectives of Financial Management
• To develop a dynamic savings mobilization and capital build-up schemes to sustain its developmental
activities and long-term investments, thereby ensuring optimum economic benefits to the members,
their families and the communities .
• To ensure regular and adequate supply of funds to the concern.
• To ensure adequate returns to the members which will depend upon the earning capacity of the
cooperative.
• To ensure optimum funds utilization. Once the funds are procured, they should be utilized in maximum
possible way at least cost.
• To ensure safety on investment, i.e, funds
should be invested in safe ventures so
that adequate rate of return can be achieved.
• To plan a sound capital structure-There should be sound and fair composition of capital so that a
balance is maintained between debt and equity capital.
1. Investment decisions includes investment in fixed assets (called
as capital budgeting). Investment in current assets are also a part
of investment decisions called as working capital decisions.
2. Financial decisions - They relate to the raising of finance from
various resources which will depend upon decision on type of
source, period of financing, cost of financing and the returns
thereby. There should be sound and fair composition of capital so
that a balance is maintained between debt and equity capital.
3. Dividend decision - The finance manager has to take decision
with regards to the net profit distribution. Net profits are generally
divided into two:
a) Interest on Share Capital-
b) Patronage Refund-
Scope/Elements
3. Choice of sources of funds: For additional
funds to be procured, a cooperative has many
choices like:
• Issue of shares
• Loans to be taken from banks and financial
institutions
4. Investment of funds: The manager
has to decide to allocate funds into
profitable ventures so that there is safety
on investment and regular returns is
possible. Funds should be invested in
secured ventures so that adequate rate of
return can be achieved.
Leverage: is an investment strategy of
using borrowed money—specifically, the
use of various financial instruments or
borrowed capital—to increase the
potential return of an investment.
5. Management of cash: The Manager has to make decisions with regards to cash
management. Cash is required for many purposes like payment of wages and salaries, payment
of electricity and water bills, payment to creditors, meeting current liabilities, maintenance of
enough stock, purchase of raw materials, etc. Utilized in maximum possible way at the very least
cost.
6. Financial controls: The manager
has not only to plan, procure and
utilize the funds but he also has to
exercise control over finances. This
can be done through many techniques
like ratio analysis, financial
forecasting, cost and profit control,
etc. Manage your finances so you
don’t overspend and remain
prepared for all expenditures, as well
as profit distributions.
Capital
Budgeting
Working Capital
Management
Cost of Capital
Capital Structure
Decisions
Leverages
ISC Policy
Retained Earnings
Objectives of Financial
Management
1. Basic Objectives
 Profit Maximization
 Wealth
Maximization
2. Operational
Objectives
 To ensure regular,
adequate and timely
supply of requisite
finances
 Most effective
Utilization of finances
 Safety of investments
 Growth of the
enterprise
3. Social Objectives
 adequate returns
Timely payment of
interest
 Payment of
reasonable interest
of share capital
 Timely payment of
wages
 Fast settlement
with suppliers
 Maintaining
relations with
financiers
4. Research Objectives
 Researching into
new and better
sources of finances
 To develop a
dynamic savings
mobilization and
capital build-up
schemes to sustain
its developmental
activities and long-
term investments,
Section 1. Source of Funds. The Cooperative may
derive its funds from any or all of the following
sources:
a. Member’s share capital contribution;
b. Loans and borrowings including deposits;
c. Revolving capital build-up which consist of the
deferred payment of patronage refund or
interest on share capital;
d. Subsidies, grants, legacies, aids, donation,
awards and winnings and such other
assistance from any local or foreign institution,
public or private;
e. Retentions from the proceeds of services
acquired /goods procured by members; and c.
Other sources of funds as may be authorized
by law.
By Laws: Article VII Capital Structure Section
By Laws. Article VII Capital Structure
Section 2. Continuous Capital Build-Up. Every
member shall have invested in any or all of the
following:
a. At least _____________Pesos (P_________)
per month;
b. At least _____ percent (__%) of his/her annual
interest on capital and patronage refund; and
c. At least _________ percent (__%) of each good
procured /service acquired from the
cooperative.
• Capital Expenditures
• Procurement of goods for sale
• Operating Expenses
• Distribution of Interest on Share Capital
and Patronage Refund
• Community Outreach
• Withdrawal of share capital
• Payment of borrowings
• Remittances to government agencies-
SSS, Phihealth, Pag-ibig and BIR
• Buy back its own stock – treasury
stocks
• Other uses
Uses of Funds
• As the word suggests is the optimum utilization
of cash to ensure maximum liquidity and
maximum profitability. It refers to the proper
collection, disbursement, and investment of cash.
For a small cooperative, proper utilization
of cash ensures solvency.
• Cash is the lifeblood of a business and a business
needs to generate enough cash from its activities
so that it can meet its expenses and have enough
left over to repay investors and grow the
cooperative. While a cooperative can fake its
earnings, its cash flow provides an idea about its
real health.
• Capital structure balance is normally upheld by establishing a
tailored equilibrium between debt and equity. Both of these funding
methods come hand-in-hand with their own unique sets of
advantages and disadvantages, which is why the vast majority of
treasurers devote a lot of their time and energy towards utilizing a
combination of the two to ensure their respective organizations are
effectively funded to meet any unique long-term objectives.
Unfortunately, there’s no magical formula am organization can
achieve to establish supreme financial harmony. There are
rough guidelines surrounding a firm’s ideal debt-to-equity ratio,
sure – but at the end of the day, each firm must carefully weigh
the pros and cons of debt and equity in order to strike the
perfect balance that works for their business.
Debt and Equity is a leverage ratio that calculates
the weight of total debt and financial liabilities against
total members equity, or, shows how much of a
cooperative is owned by creditors compared with how
much members equity is held by the cooperative.
Reference:
• cda-ReD-fr-029-performance-audit-report-rev.1-final_updated.xlsx
(live.com)

More Related Content

What's hot

Basic Cooperative Education Seminar
Basic Cooperative Education SeminarBasic Cooperative Education Seminar
Basic Cooperative Education Seminar
Jo Balucanag - Bitonio
 
Fundamental of Cooperatives by PCEDO and PCDC
Fundamental of Cooperatives by PCEDO and PCDCFundamental of Cooperatives by PCEDO and PCDC
Fundamental of Cooperatives by PCEDO and PCDC
jo bitonio
 
Delinquency control & capital build up for cooperatives
Delinquency control & capital build up for cooperativesDelinquency control & capital build up for cooperatives
Delinquency control & capital build up for cooperatives
efferson ramirez
 
Financial Management for Co-ops
Financial Management  for Co-opsFinancial Management  for Co-ops
Financial Management for Co-ops
jo bitonio
 
Governance & Management-of-coops Part II
Governance & Management-of-coops Part II Governance & Management-of-coops Part II
Governance & Management-of-coops Part II
jo bitonio
 
Policy Devt Feb 26th
Policy Devt Feb 26thPolicy Devt Feb 26th
Policy Devt Feb 26th
jo bitonio
 
Governance and Mgmt for Co-ops Part - I.pdf
Governance and Mgmt for Co-ops Part - I.pdfGovernance and Mgmt for Co-ops Part - I.pdf
Governance and Mgmt for Co-ops Part - I.pdf
jo bitonio
 
Planning Checklist and Selected Guidelines for Cooperative Operation and Mana...
Planning Checklist and Selected Guidelines for Cooperative Operation and Mana...Planning Checklist and Selected Guidelines for Cooperative Operation and Mana...
Planning Checklist and Selected Guidelines for Cooperative Operation and Mana...
jo bitonio
 
Basic Coop Management
Basic Coop ManagementBasic Coop Management
Basic Coop Management
jo bitonio
 
Orientation for Cooperative in Education and Training Committee
Orientation for Cooperative in Education and Training Committee Orientation for Cooperative in Education and Training Committee
Orientation for Cooperative in Education and Training Committee
jo bitonio
 
Strategic Planning for Coops
Strategic Planning for CoopsStrategic Planning for Coops
Strategic Planning for Coops
jo bitonio
 
Ethics & Conduct
Ethics & ConductEthics & Conduct
Ethics & Conduct
jo bitonio
 
IPEMPC Coop Premembership Seminar
IPEMPC Coop Premembership SeminarIPEMPC Coop Premembership Seminar
IPEMPC Coop Premembership Seminar
Dudsonline Web and Graphics
 
CDA MC on (the new) PAR 2021- 04
CDA MC on (the new) PAR 2021- 04CDA MC on (the new) PAR 2021- 04
CDA MC on (the new) PAR 2021- 04
jo bitonio
 
Implementing Rules and regulations of RA 9520
Implementing Rules and regulations of RA 9520Implementing Rules and regulations of RA 9520
Implementing Rules and regulations of RA 9520
jo bitonio
 
Policy Formulation for Cooperatives
Policy Formulation for CooperativesPolicy Formulation for Cooperatives
Policy Formulation for Cooperatives
Jo Balucanag - Bitonio
 
PMES
PMESPMES
Ethics and Conduct Policy for Cooperatives
Ethics and Conduct Policy for CooperativesEthics and Conduct Policy for Cooperatives
Ethics and Conduct Policy for Cooperatives
Jo Balucanag - Bitonio
 
Cda registration of-cooperatives (cda)
Cda registration of-cooperatives (cda)Cda registration of-cooperatives (cda)
Cda registration of-cooperatives (cda)
Ruth Casionan
 
Guidelines and Checklists for Philippine Cooperatives
Guidelines and Checklists for Philippine CooperativesGuidelines and Checklists for Philippine Cooperatives
Guidelines and Checklists for Philippine Cooperatives
jo bitonio
 

What's hot (20)

Basic Cooperative Education Seminar
Basic Cooperative Education SeminarBasic Cooperative Education Seminar
Basic Cooperative Education Seminar
 
Fundamental of Cooperatives by PCEDO and PCDC
Fundamental of Cooperatives by PCEDO and PCDCFundamental of Cooperatives by PCEDO and PCDC
Fundamental of Cooperatives by PCEDO and PCDC
 
Delinquency control & capital build up for cooperatives
Delinquency control & capital build up for cooperativesDelinquency control & capital build up for cooperatives
Delinquency control & capital build up for cooperatives
 
Financial Management for Co-ops
Financial Management  for Co-opsFinancial Management  for Co-ops
Financial Management for Co-ops
 
Governance & Management-of-coops Part II
Governance & Management-of-coops Part II Governance & Management-of-coops Part II
Governance & Management-of-coops Part II
 
Policy Devt Feb 26th
Policy Devt Feb 26thPolicy Devt Feb 26th
Policy Devt Feb 26th
 
Governance and Mgmt for Co-ops Part - I.pdf
Governance and Mgmt for Co-ops Part - I.pdfGovernance and Mgmt for Co-ops Part - I.pdf
Governance and Mgmt for Co-ops Part - I.pdf
 
Planning Checklist and Selected Guidelines for Cooperative Operation and Mana...
Planning Checklist and Selected Guidelines for Cooperative Operation and Mana...Planning Checklist and Selected Guidelines for Cooperative Operation and Mana...
Planning Checklist and Selected Guidelines for Cooperative Operation and Mana...
 
Basic Coop Management
Basic Coop ManagementBasic Coop Management
Basic Coop Management
 
Orientation for Cooperative in Education and Training Committee
Orientation for Cooperative in Education and Training Committee Orientation for Cooperative in Education and Training Committee
Orientation for Cooperative in Education and Training Committee
 
Strategic Planning for Coops
Strategic Planning for CoopsStrategic Planning for Coops
Strategic Planning for Coops
 
Ethics & Conduct
Ethics & ConductEthics & Conduct
Ethics & Conduct
 
IPEMPC Coop Premembership Seminar
IPEMPC Coop Premembership SeminarIPEMPC Coop Premembership Seminar
IPEMPC Coop Premembership Seminar
 
CDA MC on (the new) PAR 2021- 04
CDA MC on (the new) PAR 2021- 04CDA MC on (the new) PAR 2021- 04
CDA MC on (the new) PAR 2021- 04
 
Implementing Rules and regulations of RA 9520
Implementing Rules and regulations of RA 9520Implementing Rules and regulations of RA 9520
Implementing Rules and regulations of RA 9520
 
Policy Formulation for Cooperatives
Policy Formulation for CooperativesPolicy Formulation for Cooperatives
Policy Formulation for Cooperatives
 
PMES
PMESPMES
PMES
 
Ethics and Conduct Policy for Cooperatives
Ethics and Conduct Policy for CooperativesEthics and Conduct Policy for Cooperatives
Ethics and Conduct Policy for Cooperatives
 
Cda registration of-cooperatives (cda)
Cda registration of-cooperatives (cda)Cda registration of-cooperatives (cda)
Cda registration of-cooperatives (cda)
 
Guidelines and Checklists for Philippine Cooperatives
Guidelines and Checklists for Philippine CooperativesGuidelines and Checklists for Philippine Cooperatives
Guidelines and Checklists for Philippine Cooperatives
 

Similar to 1 Financial in Operations Management.pptx

Fm
FmFm
Fm, corporate finance
Fm, corporate financeFm, corporate finance
Fm, corporate finance
MuhammadMushtaq95
 
Finance management
Finance managementFinance management
Finance management
krn00757
 
Financial management
Financial managementFinancial management
Financial management
GIACR Engg. College, Rayagada
 
Financial management scope, elements, functions and importance
Financial management scope, elements, functions and importanceFinancial management scope, elements, functions and importance
Financial management scope, elements, functions and importance
AMALDASKH
 
Financial mgt
Financial mgtFinancial mgt
Financial mgt
Sheens18
 
FINANCIAL MANAGEMENT.pptx
FINANCIAL MANAGEMENT.pptxFINANCIAL MANAGEMENT.pptx
FINANCIAL MANAGEMENT.pptx
arunsvhec
 
Introduction to financial management
Introduction to financial managementIntroduction to financial management
Introduction to financial management
pushpalatha214
 
Meaning of financial management
Meaning of financial managementMeaning of financial management
Meaning of financial management
maddala-sravani
 
Define the term financial management
Define the term financial managementDefine the term financial management
Define the term financial management
Shameem Anwar
 
Define the term financial management
Define the term financial managementDefine the term financial management
Define the term financial management
Shameem Anwar
 
financial management
financial management financial management
financial management
Shameem Anwar
 
Financial management
Financial managementFinancial management
Financial management
Fahad Siddique
 
Financial management an overview
Financial management   an overviewFinancial management   an overview
Financial management an overview
Ashish Gupta
 
Financial planning
Financial planningFinancial planning
financialplanning 1ST UNIT AS PER CCS UNIVERSITY
financialplanning 1ST UNIT AS PER CCS UNIVERSITYfinancialplanning 1ST UNIT AS PER CCS UNIVERSITY
financialplanning 1ST UNIT AS PER CCS UNIVERSITY
MayuriSinghal2
 
An overview of financial management
An overview of financial managementAn overview of financial management
An overview of financial management
premarhea
 
PPT2.pptx
PPT2.pptxPPT2.pptx
PPT2.pptx
RiyaSingh536187
 
Tourism Finance Management
 Tourism Finance Management Tourism Finance Management
Tourism Finance Management
Ramakrishna Kongalla
 
The Meaning & Role Of Finance Management
The Meaning & Role Of Finance ManagementThe Meaning & Role Of Finance Management
The Meaning & Role Of Finance Management
Aziz Companiwala
 

Similar to 1 Financial in Operations Management.pptx (20)

Fm
FmFm
Fm
 
Fm, corporate finance
Fm, corporate financeFm, corporate finance
Fm, corporate finance
 
Finance management
Finance managementFinance management
Finance management
 
Financial management
Financial managementFinancial management
Financial management
 
Financial management scope, elements, functions and importance
Financial management scope, elements, functions and importanceFinancial management scope, elements, functions and importance
Financial management scope, elements, functions and importance
 
Financial mgt
Financial mgtFinancial mgt
Financial mgt
 
FINANCIAL MANAGEMENT.pptx
FINANCIAL MANAGEMENT.pptxFINANCIAL MANAGEMENT.pptx
FINANCIAL MANAGEMENT.pptx
 
Introduction to financial management
Introduction to financial managementIntroduction to financial management
Introduction to financial management
 
Meaning of financial management
Meaning of financial managementMeaning of financial management
Meaning of financial management
 
Define the term financial management
Define the term financial managementDefine the term financial management
Define the term financial management
 
Define the term financial management
Define the term financial managementDefine the term financial management
Define the term financial management
 
financial management
financial management financial management
financial management
 
Financial management
Financial managementFinancial management
Financial management
 
Financial management an overview
Financial management   an overviewFinancial management   an overview
Financial management an overview
 
Financial planning
Financial planningFinancial planning
Financial planning
 
financialplanning 1ST UNIT AS PER CCS UNIVERSITY
financialplanning 1ST UNIT AS PER CCS UNIVERSITYfinancialplanning 1ST UNIT AS PER CCS UNIVERSITY
financialplanning 1ST UNIT AS PER CCS UNIVERSITY
 
An overview of financial management
An overview of financial managementAn overview of financial management
An overview of financial management
 
PPT2.pptx
PPT2.pptxPPT2.pptx
PPT2.pptx
 
Tourism Finance Management
 Tourism Finance Management Tourism Finance Management
Tourism Finance Management
 
The Meaning & Role Of Finance Management
The Meaning & Role Of Finance ManagementThe Meaning & Role Of Finance Management
The Meaning & Role Of Finance Management
 

More from jo bitonio

Part III Policy Formulation for CDA R11
Part III  Policy Formulation for CDA R11Part III  Policy Formulation for CDA R11
Part III Policy Formulation for CDA R11
jo bitonio
 
Part - II Policy Formulation for CDA R11
Part - II Policy Formulation for CDA R11Part - II Policy Formulation for CDA R11
Part - II Policy Formulation for CDA R11
jo bitonio
 
Part 1 Policy Formulation for CDA R11ptx
Part 1 Policy Formulation for CDA R11ptxPart 1 Policy Formulation for CDA R11ptx
Part 1 Policy Formulation for CDA R11ptx
jo bitonio
 
Policy Development 4 La Union Coops.pptx
Policy Development 4 La Union Coops.pptxPolicy Development 4 La Union Coops.pptx
Policy Development 4 La Union Coops.pptx
jo bitonio
 
Basic Education and Literacy on Livelihood for the youth, women and Farmers
Basic Education and Literacy on Livelihood for the youth, women and Farmers Basic Education and Literacy on Livelihood for the youth, women and Farmers
Basic Education and Literacy on Livelihood for the youth, women and Farmers
jo bitonio
 
6 Adult learning & teaching.pptx
6  Adult learning & teaching.pptx6  Adult learning & teaching.pptx
6 Adult learning & teaching.pptx
jo bitonio
 
5 Coop as a tool for development.pptx
5 Coop as a tool for development.pptx5 Coop as a tool for development.pptx
5 Coop as a tool for development.pptx
jo bitonio
 
4 Best Practices.pptx
4 Best Practices.pptx4 Best Practices.pptx
4 Best Practices.pptx
jo bitonio
 
3 Philosophy, concepts, principles and values.pptx
3 Philosophy, concepts, principles and values.pptx3 Philosophy, concepts, principles and values.pptx
3 Philosophy, concepts, principles and values.pptx
jo bitonio
 
2 Overview History, laws and trends.pptx
2 Overview History, laws and trends.pptx2 Overview History, laws and trends.pptx
2 Overview History, laws and trends.pptx
jo bitonio
 
1 Expectation Setting & Objectives.pptx
1 Expectation Setting & Objectives.pptx1 Expectation Setting & Objectives.pptx
1 Expectation Setting & Objectives.pptx
jo bitonio
 
VUCA Prepraring to face the competition.pptx
VUCA Prepraring to face the competition.pptxVUCA Prepraring to face the competition.pptx
VUCA Prepraring to face the competition.pptx
jo bitonio
 
4-Rev-HRM-and-Development.pptx
4-Rev-HRM-and-Development.pptx4-Rev-HRM-and-Development.pptx
4-Rev-HRM-and-Development.pptx
jo bitonio
 
3-HRM-and-Development.pptx
3-HRM-and-Development.pptx3-HRM-and-Development.pptx
3-HRM-and-Development.pptx
jo bitonio
 
2-HRM-and-Development.pptx
2-HRM-and-Development.pptx2-HRM-and-Development.pptx
2-HRM-and-Development.pptx
jo bitonio
 
1-HRM-and-Development.pptx
1-HRM-and-Development.pptx1-HRM-and-Development.pptx
1-HRM-and-Development.pptx
jo bitonio
 
4-How-to-conduct-Meeting pptx
4-How-to-conduct-Meeting  pptx4-How-to-conduct-Meeting  pptx
4-How-to-conduct-Meeting pptx
jo bitonio
 
2-Leadership-vs-Management Feb 23.pptx
2-Leadership-vs-Management Feb 23.pptx2-Leadership-vs-Management Feb 23.pptx
2-Leadership-vs-Management Feb 23.pptx
jo bitonio
 
1 Governance & Management pptx
1  Governance & Management pptx1  Governance & Management pptx
1 Governance & Management pptx
jo bitonio
 
6 Performance Indicators in Ope Mgmt.pptx
6 Performance Indicators in Ope Mgmt.pptx6 Performance Indicators in Ope Mgmt.pptx
6 Performance Indicators in Ope Mgmt.pptx
jo bitonio
 

More from jo bitonio (20)

Part III Policy Formulation for CDA R11
Part III  Policy Formulation for CDA R11Part III  Policy Formulation for CDA R11
Part III Policy Formulation for CDA R11
 
Part - II Policy Formulation for CDA R11
Part - II Policy Formulation for CDA R11Part - II Policy Formulation for CDA R11
Part - II Policy Formulation for CDA R11
 
Part 1 Policy Formulation for CDA R11ptx
Part 1 Policy Formulation for CDA R11ptxPart 1 Policy Formulation for CDA R11ptx
Part 1 Policy Formulation for CDA R11ptx
 
Policy Development 4 La Union Coops.pptx
Policy Development 4 La Union Coops.pptxPolicy Development 4 La Union Coops.pptx
Policy Development 4 La Union Coops.pptx
 
Basic Education and Literacy on Livelihood for the youth, women and Farmers
Basic Education and Literacy on Livelihood for the youth, women and Farmers Basic Education and Literacy on Livelihood for the youth, women and Farmers
Basic Education and Literacy on Livelihood for the youth, women and Farmers
 
6 Adult learning & teaching.pptx
6  Adult learning & teaching.pptx6  Adult learning & teaching.pptx
6 Adult learning & teaching.pptx
 
5 Coop as a tool for development.pptx
5 Coop as a tool for development.pptx5 Coop as a tool for development.pptx
5 Coop as a tool for development.pptx
 
4 Best Practices.pptx
4 Best Practices.pptx4 Best Practices.pptx
4 Best Practices.pptx
 
3 Philosophy, concepts, principles and values.pptx
3 Philosophy, concepts, principles and values.pptx3 Philosophy, concepts, principles and values.pptx
3 Philosophy, concepts, principles and values.pptx
 
2 Overview History, laws and trends.pptx
2 Overview History, laws and trends.pptx2 Overview History, laws and trends.pptx
2 Overview History, laws and trends.pptx
 
1 Expectation Setting & Objectives.pptx
1 Expectation Setting & Objectives.pptx1 Expectation Setting & Objectives.pptx
1 Expectation Setting & Objectives.pptx
 
VUCA Prepraring to face the competition.pptx
VUCA Prepraring to face the competition.pptxVUCA Prepraring to face the competition.pptx
VUCA Prepraring to face the competition.pptx
 
4-Rev-HRM-and-Development.pptx
4-Rev-HRM-and-Development.pptx4-Rev-HRM-and-Development.pptx
4-Rev-HRM-and-Development.pptx
 
3-HRM-and-Development.pptx
3-HRM-and-Development.pptx3-HRM-and-Development.pptx
3-HRM-and-Development.pptx
 
2-HRM-and-Development.pptx
2-HRM-and-Development.pptx2-HRM-and-Development.pptx
2-HRM-and-Development.pptx
 
1-HRM-and-Development.pptx
1-HRM-and-Development.pptx1-HRM-and-Development.pptx
1-HRM-and-Development.pptx
 
4-How-to-conduct-Meeting pptx
4-How-to-conduct-Meeting  pptx4-How-to-conduct-Meeting  pptx
4-How-to-conduct-Meeting pptx
 
2-Leadership-vs-Management Feb 23.pptx
2-Leadership-vs-Management Feb 23.pptx2-Leadership-vs-Management Feb 23.pptx
2-Leadership-vs-Management Feb 23.pptx
 
1 Governance & Management pptx
1  Governance & Management pptx1  Governance & Management pptx
1 Governance & Management pptx
 
6 Performance Indicators in Ope Mgmt.pptx
6 Performance Indicators in Ope Mgmt.pptx6 Performance Indicators in Ope Mgmt.pptx
6 Performance Indicators in Ope Mgmt.pptx
 

Recently uploaded

PPT Item # 8&9 - Demolition Code Amendments
PPT Item # 8&9 - Demolition Code AmendmentsPPT Item # 8&9 - Demolition Code Amendments
PPT Item # 8&9 - Demolition Code Amendments
ahcitycouncil
 
Border towns and spaces of (in)visibility.pdf
Border towns and spaces of (in)visibility.pdfBorder towns and spaces of (in)visibility.pdf
Border towns and spaces of (in)visibility.pdf
Scalabrini Institute for Human Mobility in Africa
 
Abiy Berehe - Texas Commission on Environmental Quality Updates
Abiy Berehe - Texas Commission on Environmental Quality UpdatesAbiy Berehe - Texas Commission on Environmental Quality Updates
Abiy Berehe - Texas Commission on Environmental Quality Updates
Texas Alliance of Groundwater Districts
 
IEA World Energy Investment June 2024- Statistics
IEA World Energy Investment June 2024- StatisticsIEA World Energy Investment June 2024- Statistics
IEA World Energy Investment June 2024- Statistics
Energy for One World
 
Combined Illegal, Unregulated and Unreported (IUU) Vessel List.
Combined Illegal, Unregulated and Unreported (IUU) Vessel List.Combined Illegal, Unregulated and Unreported (IUU) Vessel List.
Combined Illegal, Unregulated and Unreported (IUU) Vessel List.
Christina Parmionova
 
2024: The FAR - Federal Acquisition Regulations, Part 40
2024: The FAR - Federal Acquisition Regulations, Part 402024: The FAR - Federal Acquisition Regulations, Part 40
2024: The FAR - Federal Acquisition Regulations, Part 40
JSchaus & Associates
 
RFP for Reno's Community Assistance Center
RFP for Reno's Community Assistance CenterRFP for Reno's Community Assistance Center
RFP for Reno's Community Assistance Center
This Is Reno
 
A Guide to AI for Smarter Nonprofits - Dr. Cori Faklaris, UNC Charlotte
A Guide to AI for Smarter Nonprofits - Dr. Cori Faklaris, UNC CharlotteA Guide to AI for Smarter Nonprofits - Dr. Cori Faklaris, UNC Charlotte
A Guide to AI for Smarter Nonprofits - Dr. Cori Faklaris, UNC Charlotte
Cori Faklaris
 
Circular Economy implementation in the EU
Circular Economy implementation in the EUCircular Economy implementation in the EU
Circular Economy implementation in the EU
HasanHamdan9
 
Texas Water Development Board Updates June 2024
Texas Water Development Board Updates June 2024Texas Water Development Board Updates June 2024
Texas Water Development Board Updates June 2024
Texas Alliance of Groundwater Districts
 
PAS PSDF Mop Up Workshop Presentation 2024 .pptx
PAS PSDF Mop Up Workshop Presentation 2024 .pptxPAS PSDF Mop Up Workshop Presentation 2024 .pptx
PAS PSDF Mop Up Workshop Presentation 2024 .pptx
PAS_Team
 
Milton Keynes Hospital Charity - A guide to leaving a gift in your Will
Milton Keynes Hospital Charity - A guide to leaving a gift in your WillMilton Keynes Hospital Charity - A guide to leaving a gift in your Will
Milton Keynes Hospital Charity - A guide to leaving a gift in your Will
fundraising4
 
原版制作(Hope毕业证书)利物浦霍普大学毕业证文凭证书一模一样
原版制作(Hope毕业证书)利物浦霍普大学毕业证文凭证书一模一样原版制作(Hope毕业证书)利物浦霍普大学毕业证文凭证书一模一样
原版制作(Hope毕业证书)利物浦霍普大学毕业证文凭证书一模一样
ii2sh2v
 
Indira awas yojana housing scheme renamed as PMAY
Indira awas yojana housing scheme renamed as PMAYIndira awas yojana housing scheme renamed as PMAY
Indira awas yojana housing scheme renamed as PMAY
narinav14
 
原版制作(DPU毕业证书)德保罗大学毕业证Offer一模一样
原版制作(DPU毕业证书)德保罗大学毕业证Offer一模一样原版制作(DPU毕业证书)德保罗大学毕业证Offer一模一样
原版制作(DPU毕业证书)德保罗大学毕业证Offer一模一样
yemqpj
 
原版制作(英国Southampton毕业证书)南安普顿大学毕业证录取通知书一模一样
原版制作(英国Southampton毕业证书)南安普顿大学毕业证录取通知书一模一样原版制作(英国Southampton毕业证书)南安普顿大学毕业证录取通知书一模一样
原版制作(英国Southampton毕业证书)南安普顿大学毕业证录取通知书一模一样
3woawyyl
 
Researching the client.pptxsxssssssssssssssssssssss
Researching the client.pptxsxssssssssssssssssssssssResearching the client.pptxsxssssssssssssssssssssss
Researching the client.pptxsxssssssssssssssssssssss
DanielOliver74
 
Item # 10 -- Historical Presv. Districts
Item # 10 -- Historical Presv. DistrictsItem # 10 -- Historical Presv. Districts
Item # 10 -- Historical Presv. Districts
ahcitycouncil
 
CFYT Rolling Ads Dawson City Yukon Canada
CFYT Rolling Ads Dawson City Yukon CanadaCFYT Rolling Ads Dawson City Yukon Canada
CFYT Rolling Ads Dawson City Yukon Canada
pmenzies
 
PPT Item # 5 - 318 Tuxedo Ave. (sign. review)
PPT Item # 5 - 318 Tuxedo Ave. (sign. review)PPT Item # 5 - 318 Tuxedo Ave. (sign. review)
PPT Item # 5 - 318 Tuxedo Ave. (sign. review)
ahcitycouncil
 

Recently uploaded (20)

PPT Item # 8&9 - Demolition Code Amendments
PPT Item # 8&9 - Demolition Code AmendmentsPPT Item # 8&9 - Demolition Code Amendments
PPT Item # 8&9 - Demolition Code Amendments
 
Border towns and spaces of (in)visibility.pdf
Border towns and spaces of (in)visibility.pdfBorder towns and spaces of (in)visibility.pdf
Border towns and spaces of (in)visibility.pdf
 
Abiy Berehe - Texas Commission on Environmental Quality Updates
Abiy Berehe - Texas Commission on Environmental Quality UpdatesAbiy Berehe - Texas Commission on Environmental Quality Updates
Abiy Berehe - Texas Commission on Environmental Quality Updates
 
IEA World Energy Investment June 2024- Statistics
IEA World Energy Investment June 2024- StatisticsIEA World Energy Investment June 2024- Statistics
IEA World Energy Investment June 2024- Statistics
 
Combined Illegal, Unregulated and Unreported (IUU) Vessel List.
Combined Illegal, Unregulated and Unreported (IUU) Vessel List.Combined Illegal, Unregulated and Unreported (IUU) Vessel List.
Combined Illegal, Unregulated and Unreported (IUU) Vessel List.
 
2024: The FAR - Federal Acquisition Regulations, Part 40
2024: The FAR - Federal Acquisition Regulations, Part 402024: The FAR - Federal Acquisition Regulations, Part 40
2024: The FAR - Federal Acquisition Regulations, Part 40
 
RFP for Reno's Community Assistance Center
RFP for Reno's Community Assistance CenterRFP for Reno's Community Assistance Center
RFP for Reno's Community Assistance Center
 
A Guide to AI for Smarter Nonprofits - Dr. Cori Faklaris, UNC Charlotte
A Guide to AI for Smarter Nonprofits - Dr. Cori Faklaris, UNC CharlotteA Guide to AI for Smarter Nonprofits - Dr. Cori Faklaris, UNC Charlotte
A Guide to AI for Smarter Nonprofits - Dr. Cori Faklaris, UNC Charlotte
 
Circular Economy implementation in the EU
Circular Economy implementation in the EUCircular Economy implementation in the EU
Circular Economy implementation in the EU
 
Texas Water Development Board Updates June 2024
Texas Water Development Board Updates June 2024Texas Water Development Board Updates June 2024
Texas Water Development Board Updates June 2024
 
PAS PSDF Mop Up Workshop Presentation 2024 .pptx
PAS PSDF Mop Up Workshop Presentation 2024 .pptxPAS PSDF Mop Up Workshop Presentation 2024 .pptx
PAS PSDF Mop Up Workshop Presentation 2024 .pptx
 
Milton Keynes Hospital Charity - A guide to leaving a gift in your Will
Milton Keynes Hospital Charity - A guide to leaving a gift in your WillMilton Keynes Hospital Charity - A guide to leaving a gift in your Will
Milton Keynes Hospital Charity - A guide to leaving a gift in your Will
 
原版制作(Hope毕业证书)利物浦霍普大学毕业证文凭证书一模一样
原版制作(Hope毕业证书)利物浦霍普大学毕业证文凭证书一模一样原版制作(Hope毕业证书)利物浦霍普大学毕业证文凭证书一模一样
原版制作(Hope毕业证书)利物浦霍普大学毕业证文凭证书一模一样
 
Indira awas yojana housing scheme renamed as PMAY
Indira awas yojana housing scheme renamed as PMAYIndira awas yojana housing scheme renamed as PMAY
Indira awas yojana housing scheme renamed as PMAY
 
原版制作(DPU毕业证书)德保罗大学毕业证Offer一模一样
原版制作(DPU毕业证书)德保罗大学毕业证Offer一模一样原版制作(DPU毕业证书)德保罗大学毕业证Offer一模一样
原版制作(DPU毕业证书)德保罗大学毕业证Offer一模一样
 
原版制作(英国Southampton毕业证书)南安普顿大学毕业证录取通知书一模一样
原版制作(英国Southampton毕业证书)南安普顿大学毕业证录取通知书一模一样原版制作(英国Southampton毕业证书)南安普顿大学毕业证录取通知书一模一样
原版制作(英国Southampton毕业证书)南安普顿大学毕业证录取通知书一模一样
 
Researching the client.pptxsxssssssssssssssssssssss
Researching the client.pptxsxssssssssssssssssssssssResearching the client.pptxsxssssssssssssssssssssss
Researching the client.pptxsxssssssssssssssssssssss
 
Item # 10 -- Historical Presv. Districts
Item # 10 -- Historical Presv. DistrictsItem # 10 -- Historical Presv. Districts
Item # 10 -- Historical Presv. Districts
 
CFYT Rolling Ads Dawson City Yukon Canada
CFYT Rolling Ads Dawson City Yukon CanadaCFYT Rolling Ads Dawson City Yukon Canada
CFYT Rolling Ads Dawson City Yukon Canada
 
PPT Item # 5 - 318 Tuxedo Ave. (sign. review)
PPT Item # 5 - 318 Tuxedo Ave. (sign. review)PPT Item # 5 - 318 Tuxedo Ave. (sign. review)
PPT Item # 5 - 318 Tuxedo Ave. (sign. review)
 

1 Financial in Operations Management.pptx

  • 1. Operation & Managemen of the Cooperative
  • 2. Importance of Financial Management, Human Resource (Personnel Management), Marketing, Production or Technical aspects Allocation and distribution of net surplus Overview of Ethical Standards in Cooperatives Performance and Measurement (balance scorecard) 1 2 3 4
  • 3. Management Financial It means planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds of the enterprise. It means applying general management principles to financial resources of the enterprise
  • 4. • Involves setting financial goals and analyzing data to accomplish the objectives of the organization. • It is the strategic planning of how a business should earn and spend money (10-15% of your Ave total Assets) • It includes decisions about raising capital, borrowing money and budgeting. Financial Management
  • 5. 2. Determination of capital composition: Once the estimation have been made, the capital structure have to be decided. This involves short- term and long- term debt equity analysis. This will depend upon the proportion of equity capital a cooperative is possessing and additional funds which have to be raised from outside parties. (100 – 150 % liquidity) Functions of Financial Management 1. Estimation of capital requirements: A finance manager has to make estimation with regards to capital requirements of the cooperative. This will depend upon expected costs and profits and future program and policies of a concern. Estimations have to be made in an adequate manner which increases earning capacity of enterprise.
  • 6. Objectives of Financial Management • To develop a dynamic savings mobilization and capital build-up schemes to sustain its developmental activities and long-term investments, thereby ensuring optimum economic benefits to the members, their families and the communities . • To ensure regular and adequate supply of funds to the concern. • To ensure adequate returns to the members which will depend upon the earning capacity of the cooperative. • To ensure optimum funds utilization. Once the funds are procured, they should be utilized in maximum possible way at least cost. • To ensure safety on investment, i.e, funds should be invested in safe ventures so that adequate rate of return can be achieved. • To plan a sound capital structure-There should be sound and fair composition of capital so that a balance is maintained between debt and equity capital.
  • 7. 1. Investment decisions includes investment in fixed assets (called as capital budgeting). Investment in current assets are also a part of investment decisions called as working capital decisions. 2. Financial decisions - They relate to the raising of finance from various resources which will depend upon decision on type of source, period of financing, cost of financing and the returns thereby. There should be sound and fair composition of capital so that a balance is maintained between debt and equity capital. 3. Dividend decision - The finance manager has to take decision with regards to the net profit distribution. Net profits are generally divided into two: a) Interest on Share Capital- b) Patronage Refund- Scope/Elements
  • 8. 3. Choice of sources of funds: For additional funds to be procured, a cooperative has many choices like: • Issue of shares • Loans to be taken from banks and financial institutions 4. Investment of funds: The manager has to decide to allocate funds into profitable ventures so that there is safety on investment and regular returns is possible. Funds should be invested in secured ventures so that adequate rate of return can be achieved. Leverage: is an investment strategy of using borrowed money—specifically, the use of various financial instruments or borrowed capital—to increase the potential return of an investment.
  • 9. 5. Management of cash: The Manager has to make decisions with regards to cash management. Cash is required for many purposes like payment of wages and salaries, payment of electricity and water bills, payment to creditors, meeting current liabilities, maintenance of enough stock, purchase of raw materials, etc. Utilized in maximum possible way at the very least cost. 6. Financial controls: The manager has not only to plan, procure and utilize the funds but he also has to exercise control over finances. This can be done through many techniques like ratio analysis, financial forecasting, cost and profit control, etc. Manage your finances so you don’t overspend and remain prepared for all expenditures, as well as profit distributions.
  • 10. Capital Budgeting Working Capital Management Cost of Capital Capital Structure Decisions Leverages ISC Policy Retained Earnings
  • 11. Objectives of Financial Management 1. Basic Objectives  Profit Maximization  Wealth Maximization 2. Operational Objectives  To ensure regular, adequate and timely supply of requisite finances  Most effective Utilization of finances  Safety of investments  Growth of the enterprise 3. Social Objectives  adequate returns Timely payment of interest  Payment of reasonable interest of share capital  Timely payment of wages  Fast settlement with suppliers  Maintaining relations with financiers 4. Research Objectives  Researching into new and better sources of finances  To develop a dynamic savings mobilization and capital build-up schemes to sustain its developmental activities and long- term investments,
  • 12. Section 1. Source of Funds. The Cooperative may derive its funds from any or all of the following sources: a. Member’s share capital contribution; b. Loans and borrowings including deposits; c. Revolving capital build-up which consist of the deferred payment of patronage refund or interest on share capital; d. Subsidies, grants, legacies, aids, donation, awards and winnings and such other assistance from any local or foreign institution, public or private; e. Retentions from the proceeds of services acquired /goods procured by members; and c. Other sources of funds as may be authorized by law. By Laws: Article VII Capital Structure Section
  • 13. By Laws. Article VII Capital Structure Section 2. Continuous Capital Build-Up. Every member shall have invested in any or all of the following: a. At least _____________Pesos (P_________) per month; b. At least _____ percent (__%) of his/her annual interest on capital and patronage refund; and c. At least _________ percent (__%) of each good procured /service acquired from the cooperative.
  • 14. • Capital Expenditures • Procurement of goods for sale • Operating Expenses • Distribution of Interest on Share Capital and Patronage Refund • Community Outreach • Withdrawal of share capital • Payment of borrowings • Remittances to government agencies- SSS, Phihealth, Pag-ibig and BIR • Buy back its own stock – treasury stocks • Other uses Uses of Funds
  • 15. • As the word suggests is the optimum utilization of cash to ensure maximum liquidity and maximum profitability. It refers to the proper collection, disbursement, and investment of cash. For a small cooperative, proper utilization of cash ensures solvency. • Cash is the lifeblood of a business and a business needs to generate enough cash from its activities so that it can meet its expenses and have enough left over to repay investors and grow the cooperative. While a cooperative can fake its earnings, its cash flow provides an idea about its real health.
  • 16. • Capital structure balance is normally upheld by establishing a tailored equilibrium between debt and equity. Both of these funding methods come hand-in-hand with their own unique sets of advantages and disadvantages, which is why the vast majority of treasurers devote a lot of their time and energy towards utilizing a combination of the two to ensure their respective organizations are effectively funded to meet any unique long-term objectives. Unfortunately, there’s no magical formula am organization can achieve to establish supreme financial harmony. There are rough guidelines surrounding a firm’s ideal debt-to-equity ratio, sure – but at the end of the day, each firm must carefully weigh the pros and cons of debt and equity in order to strike the perfect balance that works for their business. Debt and Equity is a leverage ratio that calculates the weight of total debt and financial liabilities against total members equity, or, shows how much of a cooperative is owned by creditors compared with how much members equity is held by the cooperative.

Editor's Notes

  1. Links: https://www.pexels.com/photo/top-view-photo-of-people-near-wooden-table-3183150/