Hdcm - Project

A STUDY ON THE BUSINESS PERFORMANCE OF

G1680 POONAMALLEE PRIMARY AGRICULTURAL CO-OPERATIVE CREDIT SOCIETY. G1680 Poonamallee, Chennai (Dt).

A Project report submitted in partial fulfillment of the requirements for the award of higher diploma in cooperative management

Submitted by

K. ARUNAGIRISenior Inspector O/o The RCS HDCM Correspondence course - III BatchUnder the Guidance of

Thiru. R.GANESANDeputy DirectorNATESAN INSTITUTE OF CO-OPERATIVE MANAGEMENT,

CHENNAIJUNE - 2014 Thiru. R.GANESAN

Deputy DirectorNICM CHENNAI.

CERTIFICATE

Certified that this project report entitled A Study on the Business performance of G1680 Poonamallee Primary Agricultural Co-operative Credit Society is a record of project work done independently by K. ARUNAGIRI Under my guidance and supervision and that it has not previously formed the basis for the award of any degree, fellowship, or associate ship to him.Place :

Signature of the Guide

Date :

K. ARUNAGIRI ,

ROLL NO: 8004HDCM Correspondence CourseIII Batch

DECLARATION

I hereby declare that this project report entitled A Study on the Business performance of G1680 Poonamallee Primary Agricultural Co-operative Credit Society is a bonafide record of work done by me during the course of project work and that it has not previously formed the basis for the award to me for any degree/ diploma, associate ship, fellowship, or other similar title of any other Institution. Place :

(K. ARUNAGIRI )Date :

ACKNOWLEDGEMENT

I wish to express my sincere thanks and gratitude to Dr. P. JAGANNATHAN, Director, NICM, CHENNAI for giving me an opportunity to do this project work.

I wish to express thanks to Thiru. R.GANESAN., Deputy Director, as well as my project Guide for his Valuable guidance, encouragement and suggestion for carrying out my Project work.

My thanks are due to Thiru. K.S.Ravichandran, President and Thiru.G.Giridhharan, Secretary and all other staff members of G1680 Poonamallee Primary Agricultural Co-operative Credit Society, Poonamallee for their kind Co-operation. I also convey my sincere thanks to all for providing me with valuable data and all necessary informations and everyone who helped me to complete my project work. (K. ARUNAGIRI ) CONTENTSCHAPTER NOTITLEPAGE NO

1INTRODUCTION & DESIGN OF

THE STUDY6

2PROFILE OF THE G1680 POONAMALLEE PACCS

16

3FUNCTIONS AND BUSINESS PERFORMANCE

OF THE PACCS24

4FINDINGS & SUGGESTIONS

49

5BIBLIOGRAPHY

53

CHAPTER 1

INTRODUCTION & DESIGN OF THE STUDYHistory of the cooperative movement

The cooperative movement began in Europe in the 19th century, primarily in Britain and France, although The Shore Porters Society claims to be one of the world's first cooperatives, being established in Aberdeen in 1498 (although it has since demutualized to become a private partnership). The industrial revolution and the increasing mechanization of the economy transformed society and threatened the livelihoods of many workers. The concurrent labor and social movements and the issues they attempted to address describe the climate at the time.

The first consumer cooperative may have been founded on March 14, 1761, in a barely furnished cottage in Fenwick, East Ayrshire, when local weavers manhandled a sack of oatmeal into John Walker's whitewashed front room and began selling the contents at a discount, forming the Fenwick Weavers' Society.

In the decades that followed, several cooperatives or cooperative societies formed including Lennoxtown Friendly Victualling Society, founded in 1812.

By 1830, there were several hundred co-operatives. Some were initially successful, but most cooperatives founded in the early 19th century had failed by 1840.Heart of England Co-operative SocietyHYPERLINK "http://en.wikipedia.org/wiki/History_of_the_cooperative_movement" \l "cite_note-3#cite_note-3"

However, Lockhurst Lane Industrial Co-operative Society (founded in 1832 and now ), and Galashiels and Hawick Co-operative Societies (1839 or earlier, now Lothian, Borders & Angus Co-operative Society) still trade today.

It was not until 1844 when the Rochdale Society of Equitable Pioneers established the Rochdale Principles on which they ran their cooperative, that the basis for development and growth of the modern cooperative movement was established.

Robert OwenRobert Owen (17711858) is considered the father of the cooperative movement. A Welshman who made his fortune in the cotton trade, Owen believed in putting his workers in a good environment with access to education for themselves and their children. These ideas were put into effect successfully in the cotton mills of New Lanark, Scotland. It was here that the first co-operative store was opened. Spurred on by the success of this, he had the idea of forming "villages of co-operation" where workers would drag themselves out of poverty by growing their own food, making their own clothes and ultimately becoming self-governing. He tried to form such communities in Orbiston in Scotland and in New Harmony, Indiana in the United States of America, but both communities failed.

William King

Although Owen inspired the co-operative movement, others such as Dr William King (17861865) took his ideas and made them more workable and practical. King believed in starting small, and realized that the working classes would need to set up co-operatives for themselves, so he saw his role as one of instruction. He founded a monthly periodical called The Co-operator, the first edition of which appeared on 1 May 1828. This gave a mixture of co-operative philosophy and practical advice about running a shop using cooperative principles. King advised people not to cut themselves off from society, but rather to form a society within a society, and to start with a shop because, "We must go to a shop every day to buy food and necessaries - why then should we not go to our own shop?" He proposed sensible rules, such as having a weekly account audit, having 3 trustees, and not having meetings in pubs (to avoid the temptation of drinking profits).

The Rochdale PioneersThe Rochdale Society of Equitable Pioneers was a group of 28 weavers and other artisans in Rochdale, England, that was formed in 1844. As the mechanization of the Industrial Revolution was forcing more and more skilled workers into poverty, these tradesmen decided to band together to open their own store selling food items they could not otherwise afford. With lessons from prior failed attempts at co-operation in mind, they designed the now famous Rochdale Principles, and over a period of four months they struggled to pool together one pound sterling per person for a total of 28 pounds of capital. On December 21, 1844, they opened their store with a very meager selection of butter, sugar, flour, oatmeal and a few candles. Within three months, they expanded their selection to include tea and tobacco, and they were soon known for providing high quality, unadulterated goods.Co-operative movement in india

During the British rule , Nicholson a British Officer in India suggested to introduce Raiffersen model of German agricultural credit Cooperatives in India. As a follow-up of that recommendation, the first Cooperative Society Act of 1904 was enacted to enable formation of "agricultural credit cooperatives" in villages in India under Government sponsorship. With the enactment of 1904 Act, Cooperatives were to get a direct legal identity as every agricultural Cooperative was to be registered under that Act only. The 1904 Cooperative Societies Act, was repealed by 1912 Cooperative Societies Act which provided formation of Cooperative societies other than credit. Under 1919 Administrative Reforms act , Cooperatives was made a provincial subject making each province responsible for Cooperative development. In 1942, the British Government enacted the Multi-Unit Cooperative Societies Act, 1942 with an object to cover societies whose operations are extended to more than one state. The impulses of the Indian freedom movement gave birth to many initiatives and institutions in the post independence era in India and armed with an experience of 42 years in the working of Multi Unit Cooperative Societies and the Multi-Unit Cooperative Societies Act, 1942, the Central Government enacted a comprehensive Act known as Multi State Cooperative Societies Act,1984,repealing the Act of 1942.

GROWTH OF COOPERATIVE SECTOR IN INDIA

India has basically an agrarian economy with 72% of its total population residing in rural areas . The rural people need lot of services in daily life which are met by villageco-operative societies. The seeds of cooperation in India were sown in 1904 when the first Cooperative Societies Act was passed . Since then, the cooperative movement has made significant progress. Cooperatives have extended across the entire country and there are currently an estimated 230 million members nationwide. The cooperative credit system of India has the largest network in the world and cooperatives have advanced more credit in the Indian agricultural sector than commercial banks. The village cooperative societies provide strategic inputs for the agricultural sector, consumer societies meet their consumption requirements at concessional rates; marketing societies help the farmer to get remunerative prices and co-operative processing units help in value additions to the raw products etc. In addition, co-operative societies are helping in building up of storage go-downs including cold storages, rural roads and in providing facilities like irrigation, electricity, transport and health. Various development activities in agriculture, small industry marketing and processing, distribution and supplies are now carried on through co-operatives. In fertiliser production and distribution the Indian Farmers Fertilizer Cooperative (IFFCO) commands over 35 percent of the market. In the production of sugar the cooperative share of the market is over 58 percent and in the marketing and distribution of cotton they have a share of around 60 percent. The cooperative sector accounts for 55 percent of the looms in the hand-weaving sector. Cooperatives process, market and distribute 50 percent of edible oils. Dairy cooperatives operating under the leadership of the National Dairy Development Board and through 15 state cooperative milk marketing federations has now become the largest producer of milk in the world. The groundwork for this was laid in the early 1970's when the largest dairy development programme in the world - Operation Flood - was launched. Operation Flood was a national marketing strategy linked to a dairy infrastructure development programme that created a chain of dairy processing plants, collection stations and a national milk transportation grid. With the passage of the Insurance Act, cooperatives have been allowed to entry into the insurance business. Insurance is a field where the immense potential of cooperatives still remains untapped. The Indian Farmers Fertiliser Cooperative has recently teamed up with a Japanese company and formed a joint venture for undertaking general insurance business in India. This signifies that Indian cooperatives have come of age in formulating strategic alliances.The main areas of operation of co-operatives in India are as under: Agricultural credit

Agricultural supplies

Agricultural marketing

Agricultural processing

Industrial cooperatives

Public distribution of essential commodities through consumer cooperatives

Urban credit cooperatives

Housing cooperativesCooperative movement in Tamilnadu

From a small beginning, the cooperative movement in Tamilnadu has grown in strength over the years. Opening of a village cooperative credit society in Thiroor in Thiruvallore district in 1904 marked the advent of the cooperative movement in Tamilnadu ushering in a new era of services for the people of the state, particularly the agriculturist families.

The co-operative societies functioning in Tamil Nadu are governed by the following:

i) Tamil Nadu Co-operative Societies Act, 1983.

ii) Tamil Nadu Co-operative Societies Rules, 1988.

iii) Bye-laws of the respective institutions

PRINCIPLES OF COOPERATION

a) Open membership

b) Democratic management

c) Limited interest on capital

d) Distribution of surplus based on patronage

e) Provision of Co-operative Education and Training

f) Co-operation among cooperatives

g) Concern for community

ADMINISTRATIVE SETUP OF THE DEPARTMENT :

The Registrar of Cooperative Societies being the head of the department is functioning at Chennai. The Registrar of Cooperative Societies is assisted by Additional Registrars of Cooperative Societies, Joint Registrars of Cooperative Societies and Deputy Registrars of Cooperative Societies at the Headquarters. A Joint Registrar of Cooperative Societies is in-charge of each region. Circle Deputy Registrars of Cooperative Societies are working under their control.

There are 32 regions in the State with a Joint Registrar in charge of each region (District). The regional Joint Registrars are responsible for the proper functioning of the cooperative societies in the district. Expect for Chennai Region for which Additional Registrar is head of the regional office.

There are two Joint Registrars (Public Distribution System) in Chennai, exclusively to attend to the work relating to distribution of essential commodities through the public distribution system outlets of the cooperative societies functioning in Chennai City and belt areas.

The State has been divided into circles for the administration of the department. The circles on the territorial basis are generally coterminous with the Revenue Division. In Chennai City, however, there are two circles which are functioning on functional basis, one for credit and the other for non-credit cooperatives. The circle Deputy Registrars are working under the immediate control of regional joint Registrars. Many of the powers of the Registrar under the Tamilnadu Cooperative Societies Act, 1983 and the rules framed there under have been delegated to circle Deputy Registrars in respect of primary cooperatives. The Deputy Registrar attends to the inspection and supervision of all cooperative societies in his circle and discharges all statutory functions relating to the societies, such as enquiry, arbitration, execution, liquidation etc. A circle Deputy Registrar is assisted by few Cooperative Sub Registrars and a complement of Senior Inspectors, Junior Inspectors and other ministerial staff.

Apart from the regular circle Deputy Registrars, in every district, there is one Deputy Registrar (Public Distribution System) with a complementary staff for the supervision of fair price shops. They are also working under the direct control of the regional Joint Registrars. There are seven Deputy Registrars (Public Distribution System) in Chennai City functioning under the direct control of Joint Registrar (Public Distribution System) Chennai. They are inspection the various public distribution system outlets of the cooperative societies functioning in Chennai City and belt areas. Citizens can organise any type of cooperative society as they have variety of needs and services subject to the provisions to Tamilnadu cooperative Societies Act, 1983 and Rules 1988. Types of co-operative societies now functioning in the state catering to various needs of citizens are furnished here under :-

Sl. NoPurpose servedType of Cooperative Societies

1For Agriculturist at Village levelPrimary Agricultural Cooperative Banks / Farmers service Cooperative Societies.

2For Urban People (Urban Area)Cooperative Urban Banks

3For Purchase / sale of Agricultural product at remunerative price and to get loan on the pledge of product.Agricultural Producers Cooperative Marketing Societies.

4Loans for Minor Irrigation, Farming, Seri culture, Horticulture, Non Farm sector, Tractor requirement, Rural Housing, Small, Transport, Hospital, Clinic, Computer center.Primary Cooperative Agriculture and Rural Development Banks.

5For getting consumer goods at right price, and right weighment.Primary Cooperative Stores, Cooperative Wholesale Stores, Cooperative Super Markets.

6For employees in Government Department, Government sector, public sector, private sectorEmployees Thrift and Credit Cooperative Societies.

7For Barbers and WashermenBarbers Cooperative societies and Washermen Cooperative Societies.

8For LabourLabour Contact Cooperative societies.

9For Vegetable GrowersVegetable Growers Cooperative Marketing Societies.

10Agricultural Loan, Medium term loan and other loan further needs of tribal members.Large sized multipurpose societies.

PACCS Primary Agricultural Cooperative Credit Society

In Tamil Nadu, there are 4,543 Primary Agricultural Cooperative Credit Societies. Their main objective is to provide agricultural and non-agricultural credit in rural areas. They also undertake distribution and sale of agricultural inputs like fertilizers, seeds and small agricultural implements. In addition, they operate 15,569 public distribution system outlets, distributing essential commodities in rural areas.

STRUCTURE OF AGRICULTURAL CO-OPERATIVE CREDIT IN TAMILNADUNABARD

(National Level)

Short and Medium Term

Long Term Credit

State Apex Co-operative Bank

State Agricultural and

(State level)------- (1)

Rural Development Bank--------(1)

District Central Co-operative Bank

Primary Co-operative

(District Level)--------(23)

Agricultural and Rural Development Bank--------(180)

Primary Agriculture Co-operative Credit Society

(Primary Level)-------------(4543)OBJECTIVES OF THE STUDY : To study the origin and growth of G1680 Poonamallee PACCS, Poonamallee. To study the various functions of the G1680 Poonamallee PACCS, Poonamallee.

To analyze the causes of overdue of the G1680 Poonamallee PACCS, Poonamallee.

To give suitable measures to strengthen the society in future

METHODOLOGY OF THE STUDY

The study is based on case study method to analyze the performance of the PACCS, secondary data has been collected from the Audit and Annual reports of the Society.

SOURCE OF THE DATA Internal Sources :

The data such as total members of the PACCS, members share capital, overdue, Borrowing, deposits and reserves etc., have been collected for the period of 2008- 2009 to 2012 2013 from the records and registers, balance sheets and Audit report of the above mentioned period. External Sources :

Co-operative Journals, Co-operative text books and website have been used as external source.PERIOD OF STUDY:

The study covers a period 5 years from 2008-2009 to 2012-2013.

CHAPTERISATION SCHEME:

The study is organized into three chapters. The following are the details of Chapterisation scheme.

The project study starts with the Introduction & Design of the study , which deals with the origin of Co-operative movement, Co-operative movement in India, Co-operative movement in Tamilnadu.

Design of Study includes sources of the data both external and internal, sources of the date, objective, period of the study and Analysis of data.

First Chapter, Profile of the PACCS, deal with origin & growth of the PACCS, area of operation, objectives, Management and organization set up, membership of the society and its special features.

Second chapter, Functions and Business performance of the Society, deals with the mobilization of the resources, deposits, working capital, reserve fund, Borrowings, Overdue, PDS activities of the society.

The last chapter bring together the conclusion that emerged from the study and offers necessary suggestions for the improvement in the performance of the management of G1680 Poonamallee PACCS, Poonamallee, Chennai. (Dt).

CHAPTER 2PROFILE OF THE G1680 POONAMALLEE PACCS, POONAMALLEE.PROFILE OF THE G1680 POONAMALLEE PACCS, POONAMALLEE. Poonamallee is an agricultural Taluk. It is located in Chennai District, Poonamallee Taluk about 28 km from Chennai.ORIGIN AND DEVELOPMENT

The G1680 Poonamallee primary agricultural co-operative credit society was registered as a primary agricultural society on 21.10.1957 and it commenced its business from 06.11.1957, under the Tamilnadu Co-operative societies act., ADDRESS OF THE SOCIETY D.1289 G1680 Poonamallee,

Primary Agricultural Co-operative Credit Society,Thandarai Main road, By-pass Road,

Ponnamalle, Chennai-600072.AREA OF OPERATION

The area operation of the G1680 Poonamallee Agricultural Co-operative Credit society covers the following villages

Ponnamalle Chenner kuppam Parivakkam Bhanavedu thottam Thirumalisai Nasereth pettai Malayam pakkam Pidari thangal Mankadu. The total Land area is 8143 acres. Out of this wet land area 2548 acres and Dry land area 3517 acres of Cultivatable lands.OBJECTIVES OF THE SOCIETY 1. Issue of short term loans for agriculture purpose.

2. Issue of medium term loans for purchase of milk animals and for purchase of bullock cart and Agricultural allied activities. 3. Issue of loans to rural artisans and issue of loans to weaker section to earn out petty traders and cottage industries.

4. Issue of Jewel loan to members.5. Distribution of manures and pesticides.6. Collecting deposits and issuing deposit Loan. 7. To encourage the thrift and Co-operative Policies among the members and depositors.8. Public distribution of essential Commodities through PDS Shop attached with society.

9. Common Service center 10. Agricultural Service center- Implements, Equipments, Machineries. A DETAILED STUDY OF FINANCIAL PERFORMANCE OF STUDY UNIT IS DISCUSSED IN THE FOLLOWING PAGES.(1). MANAGEMENT OF THE SOCIETY

The Society is administered by the special officer. The officer of the cooperative department in the cadre of sub-registrar is appointed as a special officer (Addl charge) and the secretary and other supervisory staff assisted him. The following structure reveals the hierarchy.ORGANIZATION STRUCTURE OF THE G1680 POONAMALLEE PACCS.

General Body

Board of Management President

Secretary (1)Assistant Secretary (1)

Accounts (1)

Clerk (9)(1. Savings 2. Deposit/Deposit Loans 3. JL Issue 4. JL Collection 5. JL Issue 6. KCC/ JLA/ JLG 7. MT Loan/ ARC/ EP/ Advance 8. PDS

9.Cashier )

Fer. Sales Man (1) PDS Sales Man (8)

Office Assistant (1)Night Watchman (1) Total Staff 15

PDS Staff 8 23

II. SOURCES OF FUNDS

The primary agricultural credit society requires adequate finance to perform their functions effectively. The society can raise finance both internally and externally. The internal Source consists of share capital, entrance fees collected from members and non-members. The external source consists of loans from central cooperative Banks, loans grant and subsidies from the government and receiving deposits from members and non members.

Source of funds

(A)Internal source /

(B)External sources

(or)

(or)

Owned funds

Borrowed funds

(1)Share Capital (2)Reserves(3)Surplus

1(a)Member Govt

Statutory Reserves

Reserves Other

Reserves For Bad Debts For Overdue Reserves

(1)Deposits (2)Borrowings

(SDCCB + Govt )

a)Fixed b)Savings c)Recurring d) Thrift

(A) Internal sources / owned fund

I. SHARE CAPITAL

Share capital is one of the sources of primary agricultural Cooperative Credit society. The share capital is collected from the member who availing loan or services from the PACCS.

Table 1SHARE CAPITAL POSITION (in Lakhs)Particulars 2008-092009-102010-112011-122012-13

Members Share2.873.093.243.395.03

Govt. of T.N0.070.080.080.080.65

ICDP -----

Total2.943.173.323.475.68

CHART NO. 1SHARE CAPITAL

Source: Audit report of the PACCS

I. (a) MEMBERSHIP

The membership of the PACCS is classified in to two types viz., Members and associate members. Members are eligible to get all kinds of loans and also have right to vote in the general body meeting. An associate member shall not be entitled to participate in the general body meeting and has no voting right, only get the services from the society. The decline in the members is due to withdrawal and also the High court stayed the admission of new members.

TABLE 2 MEMBERS DETAILS Sl.NoYearMembersGovtTotal

1.2008-2009168711688

2.2009-2010174711748

3.2010-2011174711748

4.2011-2012174711748

5.2012-2013193211933

Membership.

2. RESERVES

There are several type of reserves created to strengthening the financial position of the society. They are statutory reserves bad debts reserves, over due reserves and other kinds of reserves all together created during the course of audit. The flexivation is due to creation of reserves for the over due loan and interest and also for statutory reserves.TABLE 3 Reserves (in lakhs)

Sl. NoYearReserve fund Other reserve fundTotal

1.2008-090.2923.1823.47

2.2009-100.3327.2627.59

3.2010-110.3332.3332.66

4.2011-121.2937.6938.92

5.2012-13 1.2940.1641.45

CHART 3 Reserves position

CHAPTER - 3FUNCTIONS AND BUSINESS PERFORMANCESOF THE PACCSFUNCTION OF THE G 1680 POONAMALLEE PRIMARY AGRICULTURAL COOPERATIVE CREDIT SOCIETY(B) EXTERNAL SOURCES / BORROWED FUND

The G1680 Poonamallee Primary Agricultural Cooperative Credit Societys main functions are accepting various kinds of deposits from members and associate members. Issue loans and advances in various purposes and trading activities in manure sales and PDS Activities and Providing common service and agricultural Implement services to the farmers. (1) DEPOSITS

The G1680 Poonamallee Primary Agricultural Cooperative Credit Society also raise its resources by way of collecting deposits under various trends in order to meet its members need and requirements of other borrowers. It has introduced various kinds of deposits which are given below.

a) Saving Deposits

b) Fixed Deposits

c) Recurring Depositsd) Thrift Deposits (Agri + MT Loan)a) SAVING DEPOSITS

A Saving deposit of account is for the people to the lower and middle classed who wish to save a part if their current income to meet their future needs and also intend to earn an income from their savings facilities, Saving account creates the habit of thrift to member and also other people.The minimum amount acceptable is very low. A deposit cannot withdraw exceeding to a certain amount of money from his saving deposits account unless prior notice is given. The society does not allow any over draft facilities to saving account holders.b) FIXED DEPOSITS

A fixed deposit is the deposits, which is not repayable before the expiry of a fixed period. Certain minimum amount and Maximum period is prescribed up to which fixed deposits are received. Interest allowed is higher than the other deposits.

Some times loans may be allowed by the society to the fixed deposit holders.

c) RECURRING DEPOSITS

The recurring deposits made by a person who undertakes, hat to pay to the society every month a fixed amount for the stipulated period. The interest rate for recurring deposits 10.5 % per annum for deposit period more than one year.d) THRIFT DEPOSITS

The Thrift Deposit were collected from the loan borrowed members at rate of 2 % to the borrowed principal amount. This deposit should be refunded only at the time of withdrawal of member ship.Table 4 DEPOSITS AND BORROWINGS (Rs.in Lakhs)YearFrom membersKCCB loans and OthersKCCB Current A/cRecapitalization FundSubsidy and othersMembers loan suspenseTotal

2008-0916.78149.78----1.650.03168.24

2009-1019.67165.02----1.650.03186.37

2010-1121.98158.35----1.650.03182.03

2011-1217.27280.87--14.911.650.03314.76

2012-1315.59223.830.3914.911.650.03256.44

CHART-4 DEPOSITS AND BORROWINGS

The above table shows that the deposits of G1680 Poonamallee PACCS for the last 5 years are increasing trend. Deposits from members are the most important source of fund for a primary Agricultural Coop Credit society. The G1680 Poonamallee PACCS takes sincere efforts to mobilize deposits from Public. The following are the different types of deposits mobilized by the G1680 Poonamallee Primary Agricultural Co-operative Credit Society.

1. Fixed Deposits

2. Saving Deposits

3. Thrift Deposits

4. Recurring Deposits

Rate of Interest

Period of DepositRate of InterestFor senior citizen

Fixed deposit 1-2 years10.5%10.25%

Savings A/c4%--

RD A/c10.5%--

Thrift8.25%--

(2) BORROWINGS

The Society has not borrowed any type of funds/ loans from the Chennai District Central Cooperative Banks or from Government or any other agencies.

C) LOAN OPERATION AND ADVANCE

The second major function of the society is issuing loan and advances. The society is lending money to the farmers/ members in terms of 1. Short term loan

2. Medium term loan

The following table reveals the member level loan outstanding for the past five years, which is in the increasing trend. Table 5 Total Member Loan outstanding

YearNo of loansAmount (in Lakhs)

2008-200961621001.09

2009-201064841263.65

2010-201163951517.48

2012-201267442026.68

2012-201366552314.19

Chart - 5 Total Member Loan outstanding

(i) SHORT TERM LOAN

Short term loans are given for the period of one year or less than one year. The type of loans are.a) Crop loan

b) Jewel loan

a) CROP LOANCrop loan is the most important component of agricultural credit extended by Primary Agricultural Cooperative Credit Society. Crop loan concentrates on productive purpose it includes purchase of seeds, fertilizer, pesticides etc.,

Crop loans are issued at two portions namely.

1. Cash portion at 60 %

2. Kind portion at 40 %

Repayment period is not More than one year according to the crop pattern. The kind portion incluses fertilizer natural manures pesticides and seed portion values. There is no interest for the crop loan if it is repaid before the due date.

Table-6 CROP LOAN ISSUE DETAILS (ALL TYPES) YearNOAmount (in lakhs)

2008-09417122.96

2009-10537170.74

2010-11607207.14

2011-12616233.43

2012-13547263.43

CHART-6 CROP LOAN ISSUE DETAILS


There are three types of Crop loans issuing to the farmers/ member of the society. They are Kishan credit card and Jewel loan (Agri) for the Individual members and Joint Liability group loan for a group which having 10-12 members.

Table 7 Kishan Credit Card (KCC)YearNoOut standing

2008-0924666.82

2009-1024772.53

2010-1123671.19

2011-1222072.28

2012-1321874.36

CHART 7 Kishan Credit Card (KCC)


Table 8 Joint Liability Group (JLG) YearNoOut standing

2008-09508.34

2009-107014.35

2010-118920.14

2011-1212029.45

2012-1314021.70

CHART 8 Joint Liability Group(JLG)


Table 9 Jewel Loan (Agri)

YearNoOut standing

2008-0912147.80

2009-1022083.86

2010-11282115.81

2011-12276131.70

2012-13322167.38

CHART 9 Jewel Loan (Agri)


b) JEWEL LOAN

Jewel loan is issued by the society on the pledge of gold jewels by the borrowers. No one is eligible to get jewel loan unless they enroll themselves as an associate member.

The jewel loan is given for the following two purposes.

Agricultural purpose No Interest upto the loan due date. JL (Agri) Non Agricultural purpose Interest charged at rate of 14.5% per year. Table-10 Jewel loan issue particulars

YearsNoAmount

(in lakhs)

2008-20095185676.88

2009-20105493917.82

2010-201153571117.83

2011-201257521598.58

2012-201358481870.46

Chart-10 Jewel loan issue particulars

(2) MEDIUM TERM LOAN

The Medium term loans are given for the purpose of Agri allied activities and purchase of farm implements purpose. The period of loan is 3-5 years.

Table 11 MT LOAN OUT STANDINGType of Loans2008-20092009-20102010-20112011-20122012-013

NoAmtNoAmtNoAmtNoAmtNoAmt

MT (Nor)6417.756220.117926.067725.718823.58

Consumer 30.27-----------------

NFS7072.615966.285255.833546.996326.29

SHG1310.501010.34810.1567.9565.14

MICRO CREDIT471.54291.16381.49391.63371.40

KVP/NSC9921.047418.385217.404411.29538.27

Deposit 26477.5422058.7820281.54175101.08310106.95

Total560201.25454175.05431192.47376194.65557171.63

Chart 11 MT LOAN OUT STANDING

(b) Deposits Loan

The deposit loan is issued on pledging of fixed deposit receipts to the society. The amount sanctioning of loan to the maximum of 85% of the Deposit value. The rate of interest being charged 2 % more than the deposit rate of interest noted in the deposit receipt. The period of loan repayment is maximum of the deposit due date.Table 12 Deposits Loans

yearNo of loansLoan out standing Amount

2008-200926474.54

2009-201022058.78

2010-201120281.54

2011-2012175101.08

2012-2013310106.95

Chart 12 Deposits Loans

(D) SUPPLY OF AGRICULTURAL INPUTS

The Primary Agricultural Co-operative Credit Society has been providing crop loans to the farmers. The loan potation includes a ratio of seeds, pesticites, fertilizer and natural manures as fixed in the agricultural credit limit with the help of the technical experts and submits it before the district cooperative bank for approval. The agricultural inputs in cash and kind required for the subsequent crop season is prepared well in advance and approved by the District central cooperative bank.

The PACCS is also marketing the manures to the members and to the outsiders. They are marking bulk purchase of manures and selling to the members and others with service motive.Table 13 SALE OF FERTILIZERInputsFertilizer

( In Lakhs)

2008-200947.93

2009-201037.18

2010-201147.76

2011-201261.71

2012-201340.06

Chart 13 SALE OF FERTILIZER

(E) PUBLIC DISTRIBUTION SYSTEM

Distribution of essential commodities through ration method was first introduced during Second world war when there was food shortage. It was a near revolution in the history of public distributions system in the country when the ration shops were the ration shops were started rough under cooperative in Tamilnadu on 1st October 1987.

The public distribution system aims of the supply of essential goods available in urban areas should also be made available in rural areas. Public distribution system is recognized as a permanent feature of the strategy to control prices, reduce fluctuation and achieve equitable distribution of essential goods such as rice, wheat, sugar, edible oil, kerosene and palmolion. According to the state policy for every 800-ration cards a retail outlet is established. As and when the number of cards is increased due the size of family holdings more shops are created. G1680 Poonamallee Primary Agricultural Cooperative credit Society doing PDS activities. There are 10 Full time shops and 4 part time shops total of 14 Shops under the control of the society and total of 8549 numbers of users are family cards. Controlled goods and non-controlled goods sales are undertaking by the society.CONTROLLED GOODS

Rice

Sugar

Wheat

Kerosene

Palm Oil

Dhur dhal

Urd dhalNON-CONTROLLED GOODS Rava

Maidha

Tea Powder

Salt

Soap

Maligai Items. Public distribution system has made perfect, since it is not treated merely an activity of distribution of goods to the people but as a welfare measure and a anti poverty programmer. The public Distribution system is a essential scheme of Government of Tamil Nadu. The Primary Agricultural Co-operative Credit Society has been assigned a vital role in distribution of quality consumer items at competitive are distributed through the PDS outlet at village level. Sl. NoName of the ShopNo of Family cards attached

1.Gangavalli - I1007

2.Gangavalli - II853

3.Gangavalli - III694

4.Anaiyampatty - I887

5.Anaiyampatty - II461

6Anaiyampatty Pudhur 376

774 Krishnapuram813

8Thanneerpandhal307

9Valasakkal Patty693

10Ganesapuram363

11Naduvalur I648

12Nadavalur II609

13Pallakkadu612

14Samathuvapuram226

Total8549

TABLE 14 DETAILS OF PDS

Sl. NoYear PDS goods sales (in lakhs)Non. PDS goods sales (in lakhs)Total

1.2008-200990.9010.43101.33

2.2009-2010118.9710.99129.96

3.2010-2011137.8411.81149.65

4.2011-2012124.0221.95145.97

5.2012-2013110.3930.51140.90

CHART 14 SALE OF PDS

Source : Audit Report of G1680 Poonamallee PACCS

BUSINESS PERFORMANCE AND ANALYSIS OF G1680 POONAMALLEE PACCS (a) WORKING CAPITAL

Working capital consists of owned found and borrowed fund. The owned fund means share capital and reserves. Borrowed fund means deposits and other borrowings. TABLE 15 working capitals (in lakhs)Sl. NoYearShare CapitalDeposits Borrowing Reserve fund Other reserve fundworking capital

1.2008-0935.281134.14122.0143.5834.351369.46

2.2009-1037.061254.58170.5453.4218.231533.83

3.2010-1139.251567.21308.0457.2617.011988.77

4.2011-1240.311842.60467.2669.6450.922470.73

5.2012-1345.301983.45339.0183.6441.182492.58

CHART 15 working capital position

The above table shows there is and increased trend in all the working capitals in share capital Deposits acceptance, Borrowings from 2008-09 to 2012-13.

RESERVE FUND

The reserve fund is created by the society mainly for the purpose of meeting unexpected the losses and increasing the maximum power of the society.

Table- 16 DETAILS OF RESERVE FUND

Sl. NoYearReserve fund

1.2008-0943.58

2.2009-1053.42

3.2010-1157.26

4.2011-1269.24

5.2012-1383.64

CHART 16 RESERVE FUND


The above table show that reserve fund from 2008-09 to 2012-13 is constant.

BORROWINGS Most of the co-operative institutions cannot fulfill their financial needs by their own capital. The Borrowing power of the PACCS is fixed under the rules of cooperative societies Act and rules. The Primary Agricultural co-operative society borrows from DCCB and Government. The Society has borrowed only agricultural credit Short term from the Chennai District Central Cooperative Banks and not borrowed any funds from Government or any other agencies. INVESTMENT

The society invests its surplus funds with CCB. Investment details of the G1680 Poonamallee PACCS is as follows.

Chart- 17 Details of Investment

Sl. NoYearInvestment

1.2008-09430.00

2.2009-10350.00

3.2010-11585.00

4.2011-12526.00

5.2012-13643.48


From the above table it clears that the investment has been gradually

increasing during the study period.Chart- 17 INVESTMENT

(b) OVER DUES

The due amount, which is not repaid within the stipulated period, is called overdue. Overdue become a major problem at primary society level. The members of the agricultural credit societies does not repay the loans, borrowed from the society due to various reasons such as drought, failure of monsoon, waiver of loans etc., TABLE 18 Details of over duesSl. NoYearOver dues No of Loans

1.2008-09105.83583

2.2009-1045.68283

3.2010-1167.96330

4.2011-1236.10251

5.2012-1376.89382

From the above table it could be seen that the over dues of the society is little high during 2008-09. But it becomes decreased, Because the collection of dues has effectively done by the society during the study period.Chart-18 Over Dues

Source: Audit Report of G1680 Poonamallee PACCSOTHER FUNCTIONS(c ) PROFIT The Society has earned Profit for the past 20 years. Continuing and declared dividend an share at the ratio Maximum of 14% every year. Sl.NoYearProfitDividend

12008-200912.6314%

22009-201025.7514%

32010-201127.8814%

42011-201246.1514%

52012-201350.1514%

(d) Agro Service Centers Mechanisation has emerged as a major thrust area of agriculture in recent times especially in the context of increased shortage of labour during peak agricultural seasons. However, the small and the marginal farmers are at a disadvantage to avail the benefit of mechanization because of their small holdings and low resource base. Therefore an initiative has been taken in the form of 100 selected Primary Agricultural Cooperative Credit Societies putting up Agro Service Centers to provide farm machineries and implements at a reasonable rentals, so that the farmers in those areas

and the small/marginal farmers in particular can access this facility and improve their farm production and productivity. These Agro Service Centers will provide the machineries like mini tractors, power tillers with attachment and rice translators etc. which will help farm mechanization even in the small and medium sized land holders

G1680 Poonamallee PACCS established agro service centre at a cost of Rs.9.66 lakhs. It provides farm equipments to the farmers at minimum rent . The following list shows the particulars of the farm equipments and their cost.Purchase DetailsSl.NOName of the Equipments Cost (Rs)

1Tractor642325.00

2Rotavator78384.00

3Power Tiller90870.00

4Earth Auger29080.00

5Rotary Tiller32296.00

6Power weeder12285.00

7Mist Blower17750.00

85 tines22050.00

99 tines26250.00

10Brush Cutter14850.00

(With out subsidy) TOTAL 965940.00

Income earned from 1.4.2012 to 31.03.2013Income - 3.23 (Lakhs)Expenditure - 2.64 (Lakhs)Net income - 0.59 (Lakhs)

CHAPTER 4FINDINGS AND SUGGESTIONS

FINDINGS

From the analysis of previous chapters the following are observed and necessary suggestions are given below There is slow decrease in the membership during the study period. The share capital of the society shows an increasing trend during the study period. The working capital of the society is increasing year by year, it is mainly depends on the borrowings and deposits year by year, and also by creation of reserves during the course of audit. The amount allocated to the Reserve fund out of its yearly profit is increasing year by year. The borrowing of the society is increasing trend during the study period Over dues of the society is in fluctuation during the study period. Mainly because collection of over dues loan performance various from year by year The PDS sale has increased during the study period.

Auditing is done regularly which help in maintain the records properly and knowing the financial of the PACCS.

Suggestions

The Society should take necessary steps for increasing the membership. The Society also increase its share capital by admitting new members.

It must take necessary steps to reduce its overdue position.

The Society has deputed its employees to various training programs, so as to keep them to touch with the changing world. The Society should try computerizing all its operations.(Now computerization under process) The public should be motivated by explaining the advantage of cooperatives when compared to other agencies. Persons with professional qualification can be employed to bring in higher productivity.

The society should take strong actions against defaulters.

The society takes necessary steps to provide knowledge about cooperative principles and habit of savings and thrift to its members. To identify the genuine members and the loan should be given to them.

Performing good services to the farmers/ members community by way of common service and Agro Service centres

Providing all Agricultural Implements, Equipments and Machineries services at very cheaper rate and constantly.

The Society office may be provided with fully Air Condition.

CONCLUSIONFrom the above study it has been ascertained that the society has made considerable progress in the fields of deposit mobilization, loan and lending aspects and other activities. Also functioning on net profit every year past 20 years, declaring 14% of dividend every year on the member share capital. Hence we can conclude that the overall performance of G1680 Poonamallee Primary agricultural co-operative Credit society during the period of study was in improving trend.BIBILOGRAPHY

a) Books

Authors

1.Co-operative Principles problem and practices

- T.N.Hajela 2.Co-operative in india

-B.S.Mathur b) Website c) Records

1. The audit report of the society.(2008-09 to 2012-13)2. By-law of G1680 Poonamallee PACCS.3. Data from files.

PAGE 30

_1464893967.xlsChart1

47.82008-20092008-2009

83.862009-20102009-2010

115.812010-20112010-2011

131.72011-20122011-2012

167.382012-20132012-2013

Series 1

Series 2

Series 3

Years

Loan outstnding (in Lakhs)

Sheet1

Series 1Series 2Series 3

2008-200947.8

2009-201083.86

2010-2011115.81

2011-2012131.7

2012-2013167.38

To resize chart data range, drag lower right corner of range.

_1464893977.xlsChart1

1001.092008-20092008-2009

1263.652009-20102009-2010

1517.482010-20112010-2011

2026.682011-20122011-2012

2314.192012-20132012-2013

Series 1

Series 2

Series 3

Years

Amount(in Lakhs)

Sheet1


2008-20091001.09

2009-20101263.65

2010-20111517.48

2011-20122026.68

2012-20132314.19


_1464929228.xls

_1464930967.xls

_1464932071.xls

_1464929091.xlsChart1

2008-200935.282008-2009

2009-201037.062009-2010

2010-201139.262010-2011

2011-201240.312011-2012

2012-201346.842012-2013

Series 2

Series 1

Series 3

Years

Share capital(in lakhs)

Sheet1


2008-200935.28

2009-201037.06

2010-201139.26

2011-201240.31

2012-201346.84


_1464893972.xlsChart1

66.822008-20092008-2009

72.532009-20102009-2010

71.192010-20112010-2011

72.282011-20122011-2012

74.362012-20132012-2013

Series 1

Series 2

Series 3

Years

Loan outstanding (in Lakhs)

Sheet1


2008-200966.82

2009-201072.53

2010-201171.19

2011-201272.28

2012-201374.36


_1464893974.xlsChart1

122.962008-20092008-2009

170.742009-20102009-2010

207.142010-20112010-2011

233.432011-20122011-2012

263.432012-20132012-2013

Series 1

Series 2

Series 3

Years

Amount(in Lakhs)

Sheet1


2008-2009122.96

2009-2010170.74

2010-2011207.14

2011-2012233.43

2012-2013263.43


_1464893970.xlsChart1

8.342008-20092008-2009

14.352009-20102009-2010

20.142010-20112010-2011

29.452011-20122011-2012

21.72012-20132012-2013

Series 1

Series 2

Series 3

Years

Amount(in Lakhs)

Sheet1


2008-20098.34

2009-201014.35

2010-201120.14

2011-201229.45

2012-201321.7


_1464893957.xlsChart1

47.932008-20092008-2009

37.182009-20102009-2010

47.762010-20112010-2011

61.712011-20122011-2012

40.062012-20132012-2013

Series 1

Series 2

Series 3

Years

Sale of fretilizer (in Lakhs)

Sheet1


2008-200947.93

2009-201037.18

2010-201147.76

2011-201261.71

2012-201340.06


_1464893962.xlsChart1

201.252008-20092008-2009

175.052009-20102009-2010

192.472010-20112010-2011

194.652011-20122011-2012

171.632012-20132012-2013

Series 1

Series 2

Series 3

Years

MT Loans Out standing (in lakhs)

Sheet1


2008-2009201.25

2009-2010175.05

2010-2011192.47

2011-2012194.65

2012-2013171.63


_1464893964.xlsChart1

676.882008-20092008-2009

917.822009-20102009-2010

1117.832010-20112010-2011

1598.582011-20122011-2012

1870.462012-20132012-2013

Series 1

Series 2

Series 3

Years

Loan outstanding (in Lakhs)

Sheet1


2008-2009676.88

2009-2010917.82

2010-20111117.83

2011-20121598.58

2012-20131870.46


_1464893959.xlsChart1

74.542008-20092008-2009

58.782009-20102009-2010

81.542010-20112010-2011

101.082011-20122011-2012

106.952012-20132012-2013

Series 1

Series 2

Series 3

Years

Deposit Loan (in Lakhs)

Sheet1


2008-200974.54

2009-201058.78

2010-201181.54

2011-2012101.08

2012-2013106.95


_1464893951.xlsChart1

1369.462008-20092008-2009

1533.832009-20102009-2010

1988.772010-20112010-2011

2470.732011-20122011-2012

2492.582012-20132012-2013

Series 1

Series 2

Series 3

Years

Working capital(in Lakhs)

Sheet1


2008-20091369.46

2009-20101533.83

2010-20111988.77

2011-20122470.73

2012-20132492.58


_1464893954.xlsChart1

101.332008-20092008-2009

129.962009-20102009-2010

149.652010-20112010-2011

145.972011-20122011-2012

140.92012-20132012-2013

Series 1

Series 2

Series 3

Years

PDS sales (in lakhs)

Sheet1


2008-2009101.33

2009-2010129.96

2010-2011149.65

2011-2012145.97

2012-2013140.9


_1464893946.xlsChart1

4302008-20092008-2009

3502009-20102009-2010

5852010-20112010-2011

5262011-20122011-2012

643.482012-20132012-2013

Series 1

Series 2

Series 3

YEARS

Investments (in lakhs)

Sheet1


2008-2009430

2009-2010350

2010-2011585

2011-2012526

2012-2013643.48


_1464893949.xlsChart1

43.582008-20092008-2009

53.422009-20102009-2010

57.262010-20112010-2011

69.242011-20122011-2012

83.642012-20132012-2013

Series 1

Series 2

Series 3

Years

R.F (in Lakhs)

Sheet1


2008-200943.58

2009-201053.42

2010-201157.26

2011-201269.24

2012-201383.64


_1464893944.xlsChart1

105.832008-20092008-2009

45.682009-20102009-2010

67.962010-20112010-2011

36.12011-20122011-2012

76.892012-20132012-2013

Series 1

Series 2

Series 3

YEARS

Overdue(in lakhs)

Sheet1


2008-2009105.83

2009-201045.68

2010-201167.96

2011-201236.1

2012-201376.89


Hdcm - Project

Documents

Transcript of Hdcm - Project