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Loans
The Supervisory and Compliance Committee reviewed loan files with the aim of ascertaining whether the processing of loans was
in keeping with the Credit Policy and procedures.
The Committee developed a review matrix which comprised the following:
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Name of the applicant
Application number
Age of applicant
Membership Data
Date of approval
Type of loan
Interest rate
Loan Amount
Loan period
Level of Security and whether the security was sufficient
Borrowing limit satisfied
Whether application and disbursement procedures were met
Loan approval officer
Delinquency period in days
Comments
There was general compliance with the Credit Policy and Procedures however the following issues are worthy of mention:
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The Committee is of the view that the Credit policy and procedures were used in the appraisal of loans but that the policy should
be reviewed to ensure that risks associated with loans be minimized. (The committee notes that the policies and procedures are
currently being reviewed)
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The Committee observed that land as collateral posed a serious risk to recovery of funds given the low demand
for properties as a result of the general economic situation.
That consolidation of loans does not necessarily help members to make payment consistently and as such they still
remain on the list of delinquent loans.
Members are also encouraged to take a more proactive role in the management of their finances, especially in these difficult
economic times. The committee has observed that the position of Financial Adviser remains vacant, however it recognizes the
efforts made by the credit union in assisting members to become financially literate, through the hosting of various workshops and
seminars on financial management. The committee therefore encourages members to take full advantage of these opportunities,
until such time as an in house advisor is employed.
Cash Count
A series of cash counts and reviews of the Financial and Accounting System were carried out. The objectives were to determine
whether actual total cash in hand was equal to the cashbook (cash on record on system) at the time of the cash count. And that
all disbursements and collections on the credit union accounts were logged on a timely basis. The Committee was satisfied with
the work done in this area and would like to express its satisfaction with the cooperation of all requisite staff.
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