Performance Standard for Philippine Cooperatives (P.I.S.O)
31
Profitability Institutional Strength Structure of Assets Operational Strength
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Transcript of Performance Standard for Philippine Cooperatives (P.I.S.O)
Profitability
Institutional
Strength
Structure of
Assets
Operational
Strength
a. Profitability Ratio
Measure the capacity of the cooperative to
generate surplus
Net Operating Surplus
---------------------------------------------------------------
Gross Operating Revenue or Gross Margin
30% and above 5 points
25% to below 30% 4 points
10% to below 25% 3 points
5% to below 10% 2 points
below 5% 1 point
b. Earning per share
Measure the capacity of cooperative to provide
earnings to members' capital contribution
Net Surplus
-----------------------------------------------------
Members' Equity - Treasury Share
Php 2.50 and above 5 points
Php 2 to below 2.50 4 points
Php 1.50 to below 2.00 3 points
Php 1.00 to below 1.50 2 points
below Php 1 to Php 0.75 1 point
c. Profitability Growth Rate
Measure the growth rate of profitability
for the period
Earning/share end – Earning/share
beginning
------------------------------------------------------
Earning per share beginning
100% and above 5 points
75% to below 100% 4 points
50% to below 75% 3 points
30% to below 50% 2 point
10% but below 30% 1 point
d. Asset Efficiency Rate
Measure the efficient use of assets to
generate surplus
Net surplus
Total Assets
20% and above 5 points
15% to below 20% 4 points
10% to below 1% 3 points
5% to below 10% 2 points
below 5% 1 point
e. Rate of Interest on Share Capital (as
prescribed in the by-laws; or if not provided,
follow Rule 10 of IRR)
Measure the return on members' share capital
Amount of Interest on Share Capital
Average Paid up Share Capital
Higher than the inflation rate 5 points
within the inflation rate 4 points
2 pts below inflation rate 2 points
3 pts or more below inflation rate 1 point
f. Rate of Patronage
Measure the rate of returns on members'
patronage
30% & above of the NS 5 points
for distribution to members
25% to below 30 % 4 points
15% to below 25% 3 points
10% to below 15 % 2 points
5% to below 10% 1 point
Note: if the rate of patronage refund is more than twice the rate of interest on capital, the rating is zero
a. Net Institutional Capital
Measure the level of institutional capital after subtracting
the allowance for probable losses
(Reserves + APLL and/or A/R) – (Problem Assets + Past Due
Receivables + Receivables Under Litigations +
Restructured Receivables)
----------------------------------------------------------------------------------- Total Assets
10% and above 6 points
8% to below 10% 5 points
6% to below 8% 4 points
4% to below 6% 3 points
2% to below 4% 2 points
below 2% 1 point
b. Appropriate Provisioning for Probable Losses
b.1 Past due of more than one (1) year
Measures the adequacy of provision for probable losses
for past due accounts of more than one (1) year
Allowance for probable losses on receivables
Past due receivables over one (1) year
100% and above 7 points
90% to below 100% 6 points
70% to below 90% 5 points
50% to below 70% 4 points
30% to below 50% 3 points
10% to below 30% 2 points
Below 10% but not zero 1 point
b. Appropriate Provisioning for Probable Losses
b.2 Past due of thirty one (31) days to one (1) year
Measures the adequacy of provisions for probable
losses for past due accounts 31 days to 1 year
APL on receivables - allowance required for
past due receivables one year and above
Total past due receivables 31 days to 1 year
35% and above 7 points
30% to below 35% 6 points
25% to below 30% 5 points
20% to below 15% 4 points
15% to below 20% 3 points
10% to below 15% 2 points
Below 10% but not zero 1 point
a. Percentage of non-earning assets to
total assets
Measures the percentage of non-earning assets
to total assets
Non-earning Assets
---------------------------------------
Total Assets
10% and below 5 points
Above 10% to 20% 4 points
Above 20% to 30% 3 points
Above 30% to 40% 2 points
Above 40% 1 point
b. Members' equity to total assets
Measures the degree of participation of
members' share to total assets
Paid-up Share + Deposit for Capital
Subscription
-----------------------------------------------------
Total Assets
40% to below 50% 5 points
50% to below 60% 3 points
30% to below 40% 3 points
60% to below 70% 2 points
20% to below 30% 2 points
Below 20% or Above 70% 1 point
c. Deposit liabilities to total assets
Measures the percentage participation of
deposit liabilities to total assets
Total deposit liabilities
Total Assets
30% to 40% 5 points
Above 40% to 50% 4 points
20% to below 30% 4 points
Above 50% to 60% 3 points
Below 20% to 10% 3 points
Above 60% to 70% 2 points
Below 10% to 5% 2 points
Above 70% or below 5% 1 point
d. External borrowings to total assets
Measures the dependence of cooperative to
external borrowings
Total external borrowings
Total Assets
No external borrowings 5 points
1% to 20% 4 points
above 20% to 30% 3 points
above 30% to 40 % 2 points
above 40% 1 point
e. ACCOUNTS/LOANS RECEIVABLE TO TOTAL ASSETS
5
a. Volume of business to total assets
Measure the capacity of assets to generate
business
Total volume of business
Total assets
100% and above 5 points
75% to below 100% 4 points
50% to below 75% 3 points
25% to below 50 % 2 points
5% to below 25% 1 point
below 5% zero
b. Solvency
Measures the degree of protection that the cooperative has
for members savings and share capital in the event of
liquidation of coop's assets and liabilities
(Assets + APL) - [ (Total liabilities - Deposit liabilities)+
(Past due receivables + restructured receivables +
receivables under litigation)]
---------------------------------------------------------------------------------
Deposit liabilities + Share capital
10% and above 5 points
100% to below 110% 4 points
85% to below 100% 3 points
75% to below 85% 2 points
50% below 75 % 1 point
c. Liquidity
Measures the cooperative's ability to service
withdrawal of members' deposit on time
Liquid assets - Short term payables
Total members' deposit
15% to 30% 5 points
Below 15% to 10% 4 points
Above 30 to 50% 4 points
Below 10% to 5% 3 points
Above 50% to 60% 3 points
Below 5% to 1% 2 points
Above 60 to 80% 2 points
Above 80% or below 1% 1 point
d. Efficiency
d.1 Cost per volume of business
Measures the efficiency in managing the cooperative's
business
Operating cost – (Members‘ Benefit Expense
+ Social Service Expense)
----------------------------------------------------------------------------
total volume of business
25 cents and below 5 points
26 to 22 cents 3 points
33 to 39 cents 2 points
40 to 46 cents 1 point
47 cents and above zero
d. Efficiency
d. 2 Administrative efficiency
Administrative cost – (Members Benefit
Expense + Social Service Expense)
-------------------------------------------------------------
Average total assets
10% and above 5 points
Above 10% to below 15% 3 points
Above 15% to below 20% 2 points
Above 20% to below 25% 1 point
Above 25% zero
d. Efficiency
d.5 Turnovers
Measures the number of times receivables or inventories
are moving within the reporting period
Receivables (trade &loans)
Average Receivables
4 times and more 5 points
3 to below 4 times 3 points
2 to below 3 times 2 points
Below 2 times 1 point
