Compliance on Performance Report Standard of Cooperatives

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Non-Financial performance measures are used to assess the non-financial aspects of the firm which comprises human resource development, member and employee and governance. On the other hand, financial performance measures are used to quantify organization’s performance through the use of financial ratios, including but not limited to, profit, earnings per share and return on investment (Gijsel, 2012).

Profitability ratios, for example, are used to evaluate business’ capacity to produce earnings in relation to its costs in a definite period of time (Lakew et al., 2014). These ratios help the organization identify its deficiencies as well as its strength. Consequently, these ratios helps management to make sound decisions.

According to Waithaka (2013), good governance composed of people, behaviour, standards and method to make sure of proper management and as a guide towards achieving its goals. Further he found that firms tend to improve and become more socially minded when they have stronger financial performance. Gijsel (2012), stated that financial and non-financial performance measures both seem to have its own flaws and edge over each other, and incorporating both usually results to a favourable level of returns.

In related study of Masuku, T., Masuku, M. and Mutangira (2016), findings showed that improperly managed cooperatives is manifested by outdated financial records and delayed submission of financial statements which by the use of varied financial ratios resulted to poor financial performance.

Signs of Cooperative Growth

Growth take an essential part in the continuation of the life of small enterprises as it lessen the chances of retiring small businesses. This phenomenon has been examined for a reason that small businesses tend to hold their back from growing while some are unable to expand during the existence (Machado, 2016).

Number of Cooperative membership

Member’s involvement, dedication and allegiance are vital and delicate matter in the progress of cooperatives. Trust of Cooperative members towards their directors are influenced by their history profile, past experience with the cooperative and when there is an increase in the numbers of membership. All these would also influence the cooperative’s success (Othman, Kari, Jani, & Hamdan, 2012). They further stated that an increase in the number of membership directly increases member’s pledge on its share capital contribution. An enormous increase in the amount of resources possessed by cooperatives will enhance its capacity to finance in technology,

Growth in the number of members assess the degree to which cooperative ownership is distributed. Decrease in business volume per member is an indication of a problem and signals a future complication. Basically, an increase in the number of cooperative members is a positive sign of growth. (Garoyan and Mohn, 1985).

Cooperatives Net Worth