BSUCMPC-RISK-MANAGEMENT

1. BIR, AUDI Findings & NATCCO Assessment

1.1 BIR Audit

  • Key findings and implications of the Bureau of Internal Revenue audit.

1.2 Audi Findings Overview

  • Summary of the findings from the Audi report, including major financial indicators.

1.3 NATCCO Assessment

  • Overview of the assessment conducted by the National Confederation of Cooperatives and its impact.

2. Financial Performance

2.1 Current Financial State

  • Snapshot of financial performance metrics as of now.

2.2 Sources of Funds

  • Total assets: 4.4B

  • Key components:

    • Statutory Funds

    • Share Capital

    • Deposit Liabilities: Savings & Time Deposits

    • Undivided Net Surplus

    • Other Liabilities

2.3 Uses of Funds

  • Loans Receivable

  • Accounts Receivable

  • Cash in Banks

  • Liquid Investments

  • Investment Properties

  • Cash

  • Other Assets

  • Total assets remain at 4.4B.

3. Compliance Highlights

3.1 Audit Compliance (2022)

  • Overview of tax deficiencies identified reducing from 7M to 4.6M.

3.2 Non-Member Tenant Contributions

  • Major contributor: Non-member tenants contributing 4.3M.

  • Example: Bonifacio Annie’s Place Naguilian.

  • Suggestion: Encourage non-members to become associate members.

3.3 Employee Benefits & Allowances

  • Description of benefits offered:

    • Cash Incentives

    • Hazard Pay

    • Transportation Allowance

    • Load Allowance

    • Housing Allowance

    • Cost of Living Allowance (COLA)

    • Loan Interest Differential

    • Other benefits.

3.4 Withholding Tax Rates

  • Overview of withholding tax rates on goods (1%) and services (2%).

4. Audit Findings Summary

4.1 Financial Performance Ratios

  • Significant ratios from December 2019 through August 2024:

    • Total Assets Growth: 11% to 24%.

    • Net Surplus: Growth noted, peaking at 177M in 2023.

4.2 Loan Types and Contributions

  • Breakdown of outstanding balances and contributions to PAR (Portfolio at Risk).

5. Risk Management Insights

5.1 Risk Overview

  • How different risk levels are classified in the organization.

5.2 Major Findings in Loan Documentation

  • Issues with redundancy in documentation and processing errors.

5.3 Common Contributors to Risk

5.3.1 Salary Billing Errors

  • Corrective measures for wrong salary billing.

5.3.2 Loan Payment Computation

  • Importance of double-checking payment computations.

5.3.3 Member Forgetfulness on Loans

  • Suggested reminders: notices through calls, texts, and letters.

6. NATCCO Risk Classification and Events

6.1 Risk Areas

  • Detailed classifications of risk areas and their assessment from critical to low levels.

6.2 Action Plans for Risk Events

  • Management actions for addressing negative institutional capital and loan documentation deficiencies.

7. Challenges Ahead

7.1 Questions Addressed

  • Challenges identified include:

    • Becoming a model cooperative.

    • Strengthening community partnerships.

    • Fostering member engagement.

8. Assignments

  • Upcoming tasks for team members:

    1. Submit leave forms by October 31, 2024.

    2. Write reflections on motivations to stay.

    3. Individual recommendations for operations improvements.

    4. Departmental operational recommendations.