In line with the mandate of government agencies which is to render or deliver public services to Filipino citizens for the improvement of their well-being and general welfare, the Department of Agriculture (DA), Department of Agrarian Reform (DAR), Department of Environment and Natural Resources (DENR), Land Bank of the Philippines (LBP) and Agricultural Credit Policy Council (ACPC) were jointly implementing the Agrarian Production Credit Program (APCP) which aimed to provide credit assistance for crop production and livelihood enterprises to newly organized and existing Agrarian Reform Beneficiaries Organizations (ARBO) and Farmers Organizations (FO) other than ARBOs that are generally not qualified under the regular credit programs of LBP.
Amongst the good performing ARBOs, the Mapolopolo Agrarian Reform Cooperative was selected to undergo Financial Management and Loan Portfolio Management trainings. The ARBO, with principal office at Mapolopolo, Basista, Pangasinan, is a primary cooperative registered with the Cooperative Development Authority (CDA) on January 5, 2010. As of December 2020, the ARBO has a total membership of 136 individuals, 112 or 82% of ARBs. The ARBO avails credit under the program to finance crop production of the members as agricultural production is their main source of income. Other business enterprises of the ARBO are microfinance services and farm machineries and equipment rental. The cooperative is a partner of several programs and projects of DAR and other local and national agencies.The purpose of the trainings was to enable the officers to provide adequate financial and non-financial services to their members, which redounds in sustaining the gains achieved by the ARBO in terms of credit management and delivery to individual member-borrowers engaged in agricultural production and livelihood/enterprise activities.
There were 27 participants on Financial Management Training and 17 participants on Loan Portfolio Management Training who attended last May 12-14 and May 26-28, 2021. The participants for this activity are composed of the board of directors, management staff, members of the Audit Committee and Credit Committee, second-line leaders, and active members of Mapolopolo Agrarian Reform Cooperative. The facilitator is from DAR Provincial Program Point Person, Madame Lorenza Sevilla. The implementing agency tapped a learning service provider with expertise in financial management and credit management from the CDA Regional Office I employees: Sr. CDS Sherwin Arcipe, and CDS II Fiona Bianca Cuenca to discuss the training modules. They conducted the training in close coordination with the training team.
Due to the Covid-19 pandemic, the activities’ actual conduct was carried out considering the health protocol implemented by the Inter-Agency Task Force for the Management of Emerging Infectious Diseases and Provincial/Municipal/Barangay Local Government Units (LGU). Furthermore, to ensure the participant’s active participation, all sessions were conducted through a simplified adult learning scheme and/or participatory learning approach (PLA) utilizing visual presentations and symbols. Delivered sessions through group activities/tasks with more emphasis on workshops and plenary presentations.
The conduct of the activities on the 3-day training on Financial Management last May 12-14, 2021, was successful. Sherwin Arcipe and Fiona Bianca Cuenca prepared the modules needed for this training. They comprehensively discussed the six (6) sessions of the said training as follows: Session 1- Bookkeeping and Accounting, Session 2- Financial Standards, Session 3- COOP-PESOS/PISO, Session 4- Concepts of Financial Management, Session 5- Reading and Understanding Financial Statement and Session 6- Enabling the ARBO in Enabling Member-Borrowers to become Financially Viable.
In the first session, the trainers provided the participants inputs on simple bookkeeping and accounting. Afterward, a workshop on identifying accounts and simplified bookkeeping was conducted utilizing the standard chart of accounts and accounting process/cycle. The trainers began the second session with a discussion on the financial standards the ARBO should adhere to, by sharing their experiences. The participants have undergone participatory learning methodologies on how to utilize financial standards as a form of supervisory and regulatory tools to make sure that their cooperative have the financial discipline that ensures the safety and soundness of the institution. The trainers also guided them on using financial standards as management tools to ensure that their cooperative is operating effectively and efficiently. Moreover, the third session’s main activity was utilizing the tool to determine the cooperatives’ adherence to the STEPS, which the participants underwent to determine their ratings on this matter.
During the fourth session, the trainers provided the participants background on Financial Management, particularly in acquiring, financing, and managing assets and resources. The participants were also provided information on the role of financial management in the actual management and control of money and money-related operations within the cooperative. For the fifth session, the trainers guided the participants on how to read and interpret the financial statements of the cooperatives. The participants were provided inputs on the importance of findings on the financial statements that can be used for feedbacking and or reporting the cooperative’s financial status, evaluate progress, and make informed decisions on future operations. The findings can also be used as accurate and timely information to run the cooperative’s day-to-day operations. Lastly, in the sixth session, the trainers discussed various approaches that the ARBO can adopt in enabling their member-borrowers engaged in diversified livelihood activities to earn additional income to meet their financial obligations.
Indeed, the learning sessions provided the necessary competencies for key officers to enable them to oversee the management of the financial resources of the ARBO leading to graduation and mainstreaming to LBP’s and other financial institutions’ regular lending window. Specifically, the participants were able to acquire an understanding of the scope of financial management, services, and user of funds; optimized the use of various tools and techniques of financial analysis; interpreted and analyzed Financial Statements (Statement of Operations, Financial Condition, and Cash Flow Statement); explained the use of COOP-PESOS/PISO standards in evaluating the ARBO’s performance; understood the fundamentals of Bookkeeping and Accounting for Non-Accountants; and discussed various approaches in enabling the ARBO in helping their member-borrowers become financially viable to meet their financial obligations.
Also, the conduct of the activities on the 3-day training on Loan Portfolio Management last May 26-28, 2021, was fruitful. Sherwin Arcipe and Fiona Bianca Cuenca also prepared the modules needed for this training. They discussed the six (6) sessions of the said training as follows: Session 1- Fundamental Concept and Principles of Loan Portfolio Management, Session 2- Loan Portfolio Administration and Management, Session 3- Problem Loan Prevention at Stages of Credit Flow, Session 4- Identification and Definition of Type of Risks Associated with Loan in the Perspective of the Lender and Borrower, Session 5- Problem Loan Management and Session 6- Action Planning.
In the first session, the participants were provided a background on loan portfolio management, its objectives in the overall management of the cooperative, particularly in the management of the loan portfolio. The trainers also provided information on the roles of loan portfolio management in the actual management and control of lending operations within the cooperative. For the second session, the trainers imparted it as critical to the credit functions of the cooperative engaged in the lending business. During the third session, this topic guided the participants the ways in detecting and preventing problem loans on specific stages of credit flow from market/client/borrowers identification to collection and recovery
Moreover, the fourth session topics dealt with what credit risk was all about and the types of risk on the point of view of the lender and the borrower, including causes and how to possibly mitigate and or eliminate them. In the fifth session, the trainers taught the participants to understand the ARBO’s effective management of problem loans by exercising due diligence from recognizing risk from the start of the loan process to closing out of loans. Finally, the last session, which is the action planning session, focused on enhancing the cooperative’s loan portfolio management, which will redound to efficient and effective provision of loans to individual borrowers.
ndeed, these training sessions provided the ARBO officers effective management of the loan portfolio and the credit function as fundamental to the cooperative’s safety and soundness. The participants were able to acquire an understanding of the principle, concept, and scope of loan portfolio management for cooperatives; enhanced their organization’s loan portfolio management which will redound to efficient and effective provision of loans to their member-borrowers; identified and understood various risks associated with lending at the ARBO and ARB borrowers level; detected and prevented the occurrence of problem loans on specific stages of credit flow; and understood the ARBO’s effective management of problem loans by exercising due diligence from the recognition of risk from the start of loan process to closing out of loans.
In addition, the participants were very participative and active all throughout the discussions, workshops, and activities provided by the trainers. Madame Lorenza Sevilla made a recap on the learnings of the participants on the said 3-day trainings. She evaluated their learnings progress by asking them some questions in which the participants became very responsive and active. With this, the participants gave their positive impressions, such as several new learnings and inputs on financial management and credit management, how the speakers deliver their lectures, and how they easily understood the discussions. They also stressed that these learnings would be beneficial for the successful operations of their cooperative.
Truly, they were very grateful for CDA on their full support to their activities, to the speakers for patiently imparting their knowledge on the said topics for them to easily understand and absorb the learnings, to Madame Lorenza Sevilla for assisting them all throughout the 3-day trainings and also to the implementing agencies for the continuous assistance and support to them. These activities would be a big help for the cooperative to make its action plans focused on areas for enhancement of the financial position of both the ARBO and the member-borrowers and areas for enhancement of the loan portfolio management of the ARBO, which will redound to efficient and effective provision of loans to their member-borrowers engaged in agricultural crop production and/or agri-enterprise livelihood projects.
With this, the implementing agency was also satisfied with the conduct of the said trainings by the trainers. The post-learning session shall include meetings with the training team to discuss the initial results of the coaching sessions. The follow-through Technical Assistance (TA) shall be defined to be cascaded to the ARBO. Madame Lorenza Sevilla also commended the trainers, and she reiterated the possible collaboration with CDA and the trainers on the future activities of their agency.(Sherwin Arcipe / Fiona Bianca Cuenca)