Distribution Policy

Introduction Distribution policy includes any decisions and actions related to the provision of manufactured products or services to Customer or end user. Parallel to the growth in the importance of distribution and logistics has been the growth in the number of associated names and different definitions that are used. Some of the different names that have been applied to distribution and logistics include: Physical distribution; Logistics; Business logistics; Materials management; Procurement and supply; Product flow; Marketing logistics; supply chain management; demand chain management; PHYSICAL DISTRIBUTION CHANNEL Physical distribution channel is the term used to describe the method and means by which a product or a group of products are physically transferred, or distributed, from their point of production to the point at which they are made available to the final customer. In general, this end point is a retail outlet, shop or factory, but it may also be the customer's house, because some channels bypass the shop and go direct to the consumer. In addition to the physical distribution channel, another type of channel exists. This is known as the trading or transaction channel. The trading channel is also concerned with the product, and with the fact that it is being transferred from them point of production to the point of consumption. The trading channel, however, is concerned with the non-physical aspects of this transfer. These aspects concern the sequence of negotiation, the buying and selling of the product and the ownership of the goods as they are transferred through the various distribution systems. PHYSICAL DISTRIBUTION CHANNEL TYPES There are several alternative physical channels of distribution that can be used, and a combination of these maybe incorporated within a channel structure. Figure 1 illustrates the main alternative channels for a single consumer product being transferred from a manufacturer's production point to a retail store or shop. The circles in the figure indicate when products are physically transferred from one channel member to another. There are, of course, other channels that are used - channels from industrial suppliers to industrial customers, or channels that are direct to the final consumer - and these are discussed separately to the channels shown in the figure.

Figure 1: Alternative distribution channels for consumer products to retail outlets The alternative channels in Figure 1 are: Manufacturer direct to retail store. The manufacturer or supplier delivers direct from the production point to the retail store. As a general rule, this channel is only used when full vehicle loads are being delivered. Manufacturer via manufacturer's distribution operation to retail store. This was one of the classic physical distribution channels and the most common channel for many years. Here, the manufacturer or supplier holds its products in a finished goods warehouse, a central distribution centre (CDC) or a series of regional distribution centers (RDCs). The products are trunked (line-hauled) in large vehicles to the sites, where they are stored and then broken down into individual orders that are delivered to retail stores on the supplier's retail delivery vehicles. Since the 1970s, the use of this type of physical distribution channel has decreased in importance due to a number of developments in alternative channels of physical distribution. This type of channel is still commonly used by the brewing industry. Manufacturer via retailer distribution centre to retail store. This channel consists of manufacturers supplying their products to national distribution centers (NDCs) or RDCs, which are sites, run by the retail organizations. These centers act as consolidation points, as goods from the various manufacturers and suppliers are consolidated at the site. The retailers then use their own delivery vehicles to deliver full vehicle loads of all the different manufacturers' products to their own stores. Manufacturer to wholesaler to retail shop. Wholesalers have acted as the intermediaries in distribution chains for many years, providing the link between the manufacturer and the small retailers' shops. However, this physical distribution channel has altered in recent years with the development of wholesale organizations or voluntary chains. These wholesaler organizations are known as 'symbol' groups in the grocery trade. They were generally begun on the basis of securing a price advantage by buying in bulk from manufacturers or suppliers. One consequence of this has been the development of an important physical distribution channel because the wholesalers use their own distribution centers and vehicle fleets. Manufacturer to cash-and-carry wholesaler to retail shop. Another important development in wholesaling has been the introduction of cash-and-carry businesses. These are usually built around a wholesale organization and consist of small independent shops collecting their orders from regional wholesalers, rather than having them delivered. The

increase in cash-and-carry facilities has arisen as many suppliers will not deliver direct to small shops because the order quantities are very small. Manufacturer via third-party distribution service to retail shop. Third-party distribution or the distribution service industry has grown very rapidly indeed in recent years. Manufacturer via small parcels carrier to retail shop. Very similar to the previous physical distribution channel, these companies provide a 'specialist' distribution service where the 'product' is any small parcel. There has been an explosion in the 1980s and 1990s of small parcels companies, specializing particularly in next-day delivery. The competition generated by these companies has been quite fierce. Manufacturer via broker to retail shop. This is a relatively rare type of channel, and may sometimes be a trading channel and not a physical distribution channel. A broker is similar to a wholesaler in that it acts as intermediary between manufacturer and retailer. Its role is different, however, because it is often more concerned with the marketing of a series of products, and not really with their physical distribution. Thus, a broker may use third- party distributors, or it may have its own warehouse and delivery system. The broker can provide an alternative physical distribution channel. The main alternative physical distribution channels previously described refer to those consumer products where the movement is from the manufacturer to the retail store. There are additional channels for industrial products and for the delivery of some consumer products that do not fit within the structure of Figure 1 because they bypass the retail store. They necessitate the consideration of different types of distribution channel: Mail order. The use of mail order or catalogue shopping has become very popular. Goods are ordered by catalogue, and delivered to the home by post or parcels carrier. The physical distribution channel is thus from manufacturer to mail order house as a conventional trunking (line-haul) operation, and then to the consumer's home by post or parcels carrier, bypassing the retail store. Factory direct to home. The direct factory-to-home channel is a relatively rare alternative. It can occur by direct selling methods, often as a result of newspaper advertising. It is also commonly in a warehouse to provide a particular level of service to the customer. Internet and shopping from home. There is now an important development in shopping from home via the internet. Initial physical distribution channels were similar to those used by mail order operations by post and parcels carrier. The move to internet shopping for grocery products has led to the introduction of specialist home delivery distribution operations. These are almost all run by third-party companies. In addition, it is now possible to distribute some products, such as music, software and films, directly, computer to computer. Factory to factory/business to business. The factory-to-factory or business-to- business channel is an extremely important one, as it includes all of the movement of industrial products, of which there are very many. This may cover raw materials, components, part-assembled products, etc. Options vary according to the type and size of product and order, may range from full loads to small parcels, and may be undertaken by the manufacturers themselves or by a third party. It can be seen from the list of alternative channels that the channel structures can differ very markedly from one company to another. The main differences are: The types of intermediaries (as shown above); The number of levels of intermediaries (how many companies handle the product); and The intensity of distribution at each level (ie are all or just selective intermediaries used at the different levels?). An individual company may have many different products and many different types of customer. Such a company will therefore use a number of different channels within its distribution operation. This, together with the large number of variable factors and elements possible within a channel structure, makes it difficult to summarize effectively. Figure 2, however, gives a fair

representation of a typical single-channel structure. Note the different physical and trading channels.

Figure 2: Typical channel of distribution, showing the different physical and trading routes to the consumer. CHANNEL SELECTION Channel objectives will necessarily differ from one company to another, but it is possible to define a number of general points that are likely to be relevant. These should normally be considered by a company in the course of its distribution planning process to ensure that the most appropriate channel structure is developed. The main points that need to be addressed are as follows: To make the product readily available to the market consumers at which it is aimed . Perhaps the most important factor here is to ensure that the product is represented in the right type of outlet or retail store. Having identified the correct marketplace for the goods, the company must make certain that the appropriate physical distribution channel is selected to achieve this objective. To enhance the prospect of sales being made . This can be achieved in a number of ways. The most appropriate factors for each product or type of retail store will be reflected in the choice of channel. The general aims are to get good positions and displays in the store, and to gain the active support of the retail salesperson, if necessary. The product should be 'visible, accessible and attractively displayed'. Channel choice is affected by this objective in a number of ways: Does the deliverer arrange the merchandise in the shop? - Are special displays used? - Does the product need to be demonstrated or explained? Is there a special promotion of the product? To achieve co-operation with regard to any relevant distribution factors. These factors may be from the supplier's or the receiver's point of view, and include minimum order sizes, unit load types, product handling characteristics, materials handling aids, delivery access (eg vehicle size) and delivery time constraints, etc. To achieve a given level of service. Once again, from both the supplier's and the customer's viewpoints, a specified level of service should be established, measured and maintained. The

customer normally sees this as crucial, and relative performance in achieving service level requirements is often used to compare suppliers and may be the basis for subsequent buying decisions. To minimize logistics and total costs. Clearly, costs are very important, as they are reflected in the final price of the product. The selected channel will reflect a certain cost, and this cost must be assessed in relation to the type of product offered and the level of service required. To receive fast and accurate feedback of information. A good flow of relevant information is essential for the provision and maintenance of an efficient distribution service. It will include sales trends, inventory levels, damage reports, service levels, cost monitoring, etc.

The main objectives that a company needs to clarify when determining the most appropriate physical distribution channels to use have been outlined above. A number of important associated factors also need to be considered. These factors clearly affect the decisions that need to be made when designing a channel or channels used in a distribution system. They can be summarized with respect to the following general characteristics.

Purchase Policy
Purchasing is responsible for obtaining the materials, parts, supplies, and services needed to produce a product or provide a service. In manufacturing, upward of 60 percent of the cost of finished goods comes from purchased parts and materials. The percentage for purchased inventories is even higher for retail and wholesale companies, sometimes exceeding 90 percent. The importance of purchasing is more than just the cost of goods purchased; other important factors include the quality of goods and services and timing of deliveries of goods and services, both of which can have a significant impact on operations. The goal of purchasing is to develop and implement purchasing plans for products and services that support operations strategies. Among the duties of purchasing are identifying sources of supply, negotiating contracts, maintaining a database of suppliers, obtaining goods and services that meet or exceed operations requirements in a timely and cost- efficient manner, and managing suppliers. Thus, purchasing select suppliers, negotiates contracts, establishes alliances, and acts as liaison between suppliers and various internal departments. Purchasing is taking on increased importance as organizations place greater emphasis on supply chain management, quality improvement, lean production, and outsourcing. Moreover business to business buying relationships are changing. Purchasing Interfaces Purchasing has interfaces with a number of other operating areas, as well as with outside suppliers. Purchasing is the connecting link between the organization and its suppliers. In this capacity, it exchanges information with suppliers and functional areas. The Purchasing Cycle It is a series of steps that begins with a request for purchase and end with a notification of shipment received in satisfactory condition. The main steps in the cycle are these: 1. Purchasing receives the requisition. The requisition includes (a) a description of item or material desired, (b) the quantity and quality necessary (c) desired delivery dates, (d) who is requesting the purchase. 2. Purchasing select a supplier. The purchasing department must identify suppliers who have the capability of supplying desired goods. If no suppliers are currently listed in files, new ones must e sought. Vendor ratings may be referred to in choosing among vendors. 3. Purchasing places the order with a vendor. If the order involves a large expenditure, particularly for a one time purchase of equipment, for example, vendors will usually be asked to bid on the job and operating and design personnel may be asked to assist in negotiations with a vendor. Largevolume, continuous-usage items may be covered by blanket purchase orders, which often involve annual negotiation of prices with deliveries subject to request throughout the year.

Moderate-volume items may also have blanket purchase orders, they may be handled on an individual bases. Small purchases may be handled directly between the operating unit and the supplier. 4. Monitoring orders. Routine follow-up on orders, especially large orders or those with lengthy lead times, allows the purchasing department to project potential delays an relay that information to the operating unit. Conversely, the purchasing department must communicate changes in quantities and delivery needs of the operating unit to suppliers to allow them time to change their plans. 5. Receiving orders. Receiving must check shipments for quality and quantity. It must notify purchasing, accounting, and the operating unit that requested the goods. If the goods are not satisfactory, they may have to be returned to the supplier or subjected to further inspection. Centralized Versus Decentralized Purchases In centralized purchasing, purchasing is handled by one special department. It may be able to obtain lower prices than decentralized units if his higher volume created by combining orders enables it to obtain quantity discounts offered on large orders. It may also be able to obtain better service and closer attention from suppliers. In addition, centralized purchasing often enables companies to assign certain categories of items to specialists. In decentralized purchasing, individual departments handle their own purchasing requirements. It has the advantage of awareness of differing local needs and being better able to respond to those needs. It usually can offer quicker response than centralized purchasing. Ethics in Purchasing Here are some principles and standers of ethics in purchasing: Principles: (1) Loyalty with employer. (2) Justice to those you deal with. (3) Faith in your profession. Standards of Purchasing Practice: (1) Avoid appearance of unethical or compromising practices. (2) Follow the lawful instructions of your employer. (3) Refrain from private activities that might conflict with your employers interest. (4) Refrain from soliciting or accepting gifts, favors, or services from present or potential employers. (5) Handle confidential or proprietary employer or supplier information with due care. (6) Practice courtesy and impartiality in all aspects of your job. (7) Refrain from reciprocal arrangements that constrain competition. (8) Know and obey the letter and spirit of laws governing the purchasing. Supplier Management Reliable and trustworthy suppliers are a vital link in an effective supply chain. Timely delivery of goods or services and high quality are just two of the ways that suppliers can contribute to effective operations. A purchasing manager may function as an external operation manager, working with suppliers to coordinate supplier operations and buyer needs. Choosing Supplier In many respects, choosing a supplier involves taking into account many of the same factors associated with making a major purchase. A company considers price, quality, the suppliers reputation, past experience with suppliers, and service after the sale. Because different factors are important for different situations, purchasing must decide, with the help of operations, the importance of each factor, and then rate potential vendors according to how well they can be expected to perform against this list.

Supplier Audits Periodic audits of suppliers are a means of keeping current on suppliers production capabilities, quality and delivery problems and resolutions, and suppliers performance in other criteria. If an audit reveals a problem area, a buyer can attempt to find a solution before more serious problem develops. Supplier certification Supplier certification is a detailed examination of the policies and capabilities of the supplier. The certification process verifies that a supplier meets or exceeds the requirements of buyer. This is generally important in supplier relationship, but it is particularly important when buyers are seeking to establish a long-term relationship with suppliers. Rather than developing their own certification program, most companies rely on standard industry certification such as ISO 9000. Supplier Relationships Purchasing has the ultimate responsibility for establishing and maintaining good supplier relationships. The type of relationship is often related to the length of contract between buyers and sellers. Supplier partnerships More and more business organizations are seeking to establish partnerships with other organizations in their supply chains. This implies fewer suppliers, longer-term relationships, sharing of information, and cooperation in planning. Among the possible benefits are higher quality, increased delivery speed and reliability, lower inventories, lower costs, higher profits, and in general, improved operations. Sources of Labor Supply Following are some sources of labor supply for the company: 1) Persons Already easy employed: (a)Cumulative promotion (b)Promotion purpose (c) Temporary employees to permanent 2) Unsolicited Applications: (a)Emergency needs (b)Temporary basis 3) Educational institutions: (a)Fresh mind persons (b)Job trainees (c) Carrier jobs 4) Recommended by Labor Unions: (a)Lower category (b)Temporary appointment 5) Employment Agencies: (a)Middle management (b)Emergency requirements 6) Advertisement and Selection: (a)For high post (b)Standards (c) Fair competition

Finance Policy
CASH MANAGEMENT
POLICIES: There are nine (9) considerations that will serve as the policies on cash management. 1. Responsibility Considerations Cash budgeting shall be the responsibility of the various Division Heads/Committee Chairmen/PT Leaders in so far as the cash requirements of their respective division/committees/PTs are concerned. Such cash budgeting shall be spearheaded, coordinated and consolidated by the Finance Division while the Collection Division shall provide collection targets/forecasts inputs to cash budgeting. Finance Division Cash Budgeting Custody and control of all Cash Funds Responsible for the disbursement processing functions Collection Division Collection/forecasts inputs to cash budgeting All field collection Finance Division Head and Planning and Budgeting Section Responsible for financial forecasting and conduct of feasibility studies and capital budgeting Treasury Section and Finance Division All office collection activities Treasury Section All disbursement releasing functions Cashier Responsible for the proper custody and safekeeping of unused checks and check preparation Cashier, Treasury Section and Finance Division Responsible for the deposit of all daily collections Accounting Division Responsible for cost controlling Responsible for the cash accounting functions Preparation of daily trial balances of accounts and daily financial statements Submission of monthly financial statements accompanied w ith financial ratios Preparation of monthly exception reports Business Department Manager Responsible for the analysis of cost/income exceptions and financial trends and ratios. Shall exercise general supervision over all collection, disbursement a nd other cash management functions. Audit Committee Responsible for the post-review/audit of cash transactions and cash performance and the continuous review and evaluation of the cash systems. the initiation of disbursement shall be responsibility of the division concerned. Duly authorized alternate disbursement signatories and alternate check signatories and counter signatories shall be responsible for the final pre-review and approval of disbursement transactions. 2. Policy Control Considerations These shall be the guide on how to make policies on cash management The cash management policies, as a whole, shall be geared towards: Promoting coordination, efficiency and effectiveness of cash management operations; Providing understandable guidance in performing cash management functions; Maximizing yield of cash resources at acceptable risk levels.

 Promoting the timeliness and reliability of cash management reports. Strengthening controls and other safeguards on working capital resources. Ensuring compliance Promoting continuity of investment and other cash management programs Promoting continuing relevance and responsiveness of cash operations. Every cash management policy to be adopted shall be Reflective of the basic goals of our coop and the general membership. Positive, clear, understandable and reduced to writing and communicated to all officers and staff concerned. Clear-cut cash management policies shall be laid down for the various cash receipts, cash disbursement and excess fund investments. Detailed guidelines shall be developed to implement and enforce cash management policies. The Audit Committee, assisted by the Audit staff, shall continuously monitor whether or not officers and employees comply with the prescribed cash management policies and implementing guidelines. The formulation of cash management policies shall be in consultation with and/or with participation of knowledgeable officers and staff whose functions include cash management functions. The Board of Directors, assisted by the General Manager and Business Department Manager shall continuously assess cash management policies. All cash management policies, shall be promulgated by the Board of Directors except those which set forth the scope/limits or which regulate the Board itself which shall be promulgated by the General Assembly Resolution. 3. Planning Control Considerations Definite objectives and plans shall be established for the cash management operations. Adequate time importance shall be alloted by those concerned with regard to forward planning. Projected cash flows shall be periodic, accurate, realistic and detailed. Such approved cash flow projections shall be strictly followed. The Treasurer, General Manager, Business Department Manager, Finance Division Head and other financial officers shall have clear goals relating to the investment of coop funds. Top management must be in accord with the approved cash management objectives and plans. Coop investment and loan portfolios shall be diversified enough so risk from any one investment or loan type is limited. Officers (whether voluntary or paid) and staff exercising supervisory functions shall exert effort towards promoting the clear understanding of cash management objectives/plans/strategies particularly as to soundness and practicability. Approved goals/plans/budgets shall be used to measure actual performance/results Immediate superiors shall ensure the proper implementation of this planning control consideration in so far as their immediate subordinates are concerned. Approved cash management strategies shall be translated at the position level into individual cash management tactics and detailed instructions that could be clearly understood at the individual position level. 4. Receivables Control Considerations All loans receivables shall principally be covered by the control considerations set forth in the basic features of the Credit Management System. The receivables of this coop shall be classified into: Loan Receivables, Due from officers and employees, Cash Advances for Operations, Accounts Receivable - Trade, Account Receivable Employees and Other Receivables. Every receivable that by its nature normally arises as a result of the release/issue of funds, property, service and/or other coop resources shall not be allowed without a review and approval by duly designated coop officers prior to such release/issue. All other receivables of a nature not

embraced in above such as Due from officers and employees shall nonetheless be duly documented and controlled. Custody and dispatching of goods shall be segregated for sales on account operations. The access to and responsibility for recording in individual receivable subsidiary records shall be segregated from the responsibility for the safekeeping of documents supporting /evidencing the receivable. Debtors shall be encourage to pay in advance through post-dated checks. As much as practicable, discounts, interest rebates and other incentives shall be allowed to debtors who pay early ahead of due date. The sending of reminders and first notice to member-borrowers and other debtors with phone numbers may be done through phone to save on follow-up costs. The conduct of personal follow-up of receivables by the Collection Division shall be planned/arranged/assigned. All account balances shall be aged periodically. All overdue accounts shall be reviewed at prompt intervals so that immediate and timely action can be taken to protect/enforce the claim. No receivable shall be written off unless it has been clearly established that any further collection effort would be futile or the collection cost would exceed the amount collected. 5. Collection Control Considerations All officers and employees performing collection functions shall be familiar with coop policies, procedures and implementing guidelines on collections. Officers and employees to be assigned to accountable collection functions shall be carefully screened for honestly and trustworthiness. All collections, with the exception of saving deposits and sale of stamps shall be acknowledged by the immediate issuance of a pre-numbered official receipt duly assigned by the Teller, Collector or Cashier and issued in strict numerical sequence. Receipt of savings deposits shall be acknowledged in a duly validated deposit slip plus an initialed deposit passbook. Collections from sale of stamps shall not be receipted. Official Receipts shall not be issued for payments by post-dated checks. All persons authorized to receive collections on behalf of the coop shall, at the end of the every day, turn over his collections using a daily collection report with the attachment of duplicate Official Receipts and original Deposit Slips and all arranged in numerical sequences. The Daily Collection Report shall contain a breakdown and classification of collections all shall be prepared and certified by the concerned The Cashier shall acknowledge receipt of total collections turned over to him by signing all copies of the corresponding daily collection report. Every collections accountable officer concerned shall stamp CANCELLED on all voided/canceled official receipts and attach the original and duplicate copy to the daily collection report and retain the triplicate in the stub copy file. The Cashier shall safe keep all collections in the coop vault and deposit all such collections intact the following banking day. Deposits shall only be made to duly designated banks which are nearest to the coop and which are known to be financially stable. The vault and all other safes shall be kept under lock whenever unattended and access to such shall be limited to duly designated accountable officers. The duplicate secret combination of the various vaults including the main vault shall be lodged in the respective immediate superiors of those in charge of the vault. The secret combination of a vault shall be changed whenever there is a change in the custodian. Cash transactions could be conveniently conducted without needing to allow members access in the treasury section.

When there are collections through mail, the executive secretary shall be responsible for opening and listing such mail remittances and a copy of such listing shall be provided to the Journal Keeper. Cash accountable officers shall be appropriately bonded. Teller #1 shall handle the savings and fixed deposit collection while teller #2 shall handle loan collection. All other office collections shall be handled by the Cashier. Understandable instructions for various payment transactions shall be posted in a conspicuous place inside the coop. Alternate signatories and countersignatories of certificates of time deposits shall be designated by the Board of Directors. 6. Disbursement Control Considerations All disbursements shall be by checks except disbursements out of the following revolving funds: Petty cash revolving fund Cashier's revolving fund Teller change revolving funds Operations revolving fund All revolving funds shall be maintained under the imprest system. Petty cash revolving fund shall be in the custody of the Finance Division Head and shall be used to defray petty expenses not exceeding P500.00 The Cashier's revolving fund shall be set at an imprest amount of P250,000.00 and to be replenished everyday The Teller's change revolving funds shall each be set at an imprest amount of P10,000.00 The Operations revolving fund shall be in the custody of the Cashier and set at an imprest amount of P50,000.00 to be replenished at the end of everyday. The authority to modify the imprest amounts of revolving funds shall be lodged in the General Manager upon recommendation of the Department Manager concerned. At any given time, the total cash on hand and the unreplenished disbursements for each fund shall equal the imprest amount of the fund. Custodians of revolving funds shall, prepare a revolving fund replenishment summary to summarize and account for the disbursements made out of the fund in his custody. All cash advances including those out of petty cash shall be reported and liquidated as soon as the purpose intended is served or as soon as it is no longer needed. Before a petty cash disbursement is approved, such shall be ascertained to be within approved budget for the particular expense item for the division concerned. Petty cash and other expenses not normally evidenced by receipts shall be reviewed with particular emphasis on reasonability of amount. Each employee, upon arriving and after lunch break shall log his time -in and before timing-off for lunch break and at the end of the day, each employee shall also log his time-out time on his Daily Time Card Payroll disbursements for overtime shall be guided by the control considerations All employee movements, particularly those affecting payroll shall be reported immediately to the General Manager All new employees shall be required to acknowledge receipt of their salary by signing a copy of the pay slip. All employees who are not paid through payroll but through check shall be required to acknowledge receipt by signing the disbursement ticket. If an employee cannot collect his salary personally, his written authorization shall be required All applicable legal requirements relating to payroll disbursements shall be complied with. Payroll preparation shall be segregated from payroll payment function Signed withdrawal slips shall not be used as authority for disbursements

 All banks with which the coop has checking accounts shall be provided with specimen signatures of officers authorized to sign checks. All checks for signature shall be accompanied by a duly processed disbursement ticket and all necessary supporting documents. No check shall be signed in blank or in advance All voided or spoiled or cancelled checks shall be stamped CANCELLED and accounted for The authority to review, approve and sign disbursement tickets shall be lodged in the Department Manager concerned and General Manager. The authority to sign or countersign checks shall be lodged in the following alternate check signatories and countersignatories A check register shall be used by the Cashier for registering all checks drawn promptly and sequentially according to the serial number Disbursements for purchases and other expenses shall be made promptly enough as to avail discounts All withdrawals of savings deposits shall be through the Withdrawal Slip form prescribed A member-depositor may withdraw savings deposits through his representative provided such representative is duly authorized A Time Deposit Disposition Form shall be filled-up, signed and used by a memberdepositor for any one of the following time deposit transactions Every deposit withdrawal, whether time or savings shall be carefully checked against the member-depositor's specimen signature in file, in the passbook or in the member's coop I.D. to ensure the authenticity of the signature in the withdrawal slip. The processing of savings and time deposit withdrawals shall not last more than 45 minutes. No withdrawal of fixed deposits shall be processed until the written application to the Board of Directors has been approved and all liabilities and obligations have been settled or assumed by another member equally acceptable. All purchases shall be by check except petty purchases and those through cash advance. Petty purchases, on the other shall follow the procedures for petty cash revolving fund disbursements. The Disbursement Ticket shall be numbered and stamped paid together with all supporting documents to prevent re-use. The reporting of check disbursements shall be on a daily basis. The reporting of savings and time deposit withdrawals shall also be on a daily basis. The Cashier shall review report computation and adequacy/authenticity of supporting documents, check the total disbursements to agree with the total amount per duly and approved and acknowledged Teller's Fund Requisitions for the day and unused fund requisitions. To ensure completeness of deposit withdrawal recordings, daily sequential numbers shall be assigned to Withdrawal Slips and Time Deposit Disposition Forms immediately upon approval. 7. Fund Management Control Considerations Fund management shall involve the efficient management of cash and excess funds by maximizing cash availability and earnings from idle funds towards the attainment of the overall goals of the coop When the economy is characterized by rising interest rates, the fund management direction shall be towards reducing to cash to a minimum. Cash shall be maintained only for the following purposes: Transactions, Precautionary and Speculative purposes The holding of cash for speculative purposes shall be on the most limited basis only. Primarily concerned with and responsible for cash management shall be the Treasurer from the voluntary officer and management staff from the Finance Division. A cash budget shall be used to forecast monthly receipts and disbursements

 This cash budget shall serve as the foundation for cash planning and control. As such, it shall be realistic, reasonable, and responsive to the goals, direction, plans and needs of the coop The reporting of all information on cash shall be on a daily basis Cash budget shall be accompanied by pro-forma balance sheets and income statements, to enable the coop financial officers to analyze the effect of various policy decisions. As the likelihood for inaccuracies in cash forecasts increases, the provision for precautionary purposes shall also be increased and vice versa. Combination of fast collections and slow disbursements shall be for the purpose of attaining maximum funds availability. The number of bank accounts shall be limited to avoid the maintenance of unnecessary pockets of idle funds. Procedures shall aim towards eliminating or at least minimizing the loss of discounts due to clerical inefficiencies. Considering that these can be converted to cash on very short notice, marketable securities shall be used to serve the precautionary purpose of the coop to hold cash. In determining the optimal split-between cash and marketable securities --- Decisions to invest excess cash in marketable securities shall involve deciding on the amount to invest as well as deciding what type of security in which to invest. The cost of loan operations should be less than the interest and service charges for loans. The cost of investing cash and savings and time deposit operations should be less than the income generated from such cash investments. The Finance Division Head shall devote a material portion of his time in managing the various investment portfolios of the coop Fund investment performance shall be periodically and timely reviewed against specific guidelines and goals. 8. Accounting Control Considerations All staff involved in accounting functions should be familiar with accounting conventions, principles and standards. All journal and ledgers shall be under the sole custody of the Accounting Division. Physical facilities and controls shall be provided to ensure adequate safeguarding of subsidiary ledgers. All entries in the books of accounts including corrections, shall be in ink. All regular adjusting journal entries (RAJE), reversing journal entries (RJE), reclassification journal entries (RCJE), and auditor's adjusting entries (AAE) shall be effected using duly reviewed and approved Journal Vouchers. Every Journal Voucher shall be supported by appropriate documents. Every entry in any book of account shall be properly dated and cross-referred to corresponding supporting documentation. Ticking-off marks shall be used to indicate that the item concerned has been recorded/posted to appropriate book. The responsibility for every entry in every book of account shall be fixed and pinpointed using initials/signatures/ user Ids/codes. The posting of cash transactions to individual Subsidiary ledgers shall be on an on-line basis. All accounting entries to the Certificate shall be based on the duly processed time deposit disposition forms. The duplicate copy of cash advance for employees forms in the unliquidated suspense file shall serve as subsidiary ledger for cash advances for operations account advanced to officers and employees. The Journal Keeper, Accounting Division shall check completeness of numerical sequence of all official receipts and deposit slips.

 The approval of the check disbursement shall be considered as the act that consummates a disbursement transaction as to necessitate taking up in the books. Every page of a Journal of a ledger after being filled-up shall be certified as correct by the staff responsible. All such accountable forms received shall be turned over for safekeeping to the Journal Keeper, Accounting Division who shall acknowledge receipt specifying the series of serial numbers received. Every issuance of accountable forms shall be acknowledged signed by the accountable staff receiving them. Journal Keeper shall absolutely have no access to individual subsidiary ledgers and/or update/delete access to computer records of individual accounts. Accountable staff to whom accountable form booklets were issued shall be responsible for the proper safekeeping of unissued accountable forms still in their custody. At the end of every transaction day, a summary proof tape (SPT) of entries to individual subsidiary ledgers (ISL) shall be generated by the business machine/computer. The Accounting Division Head shall be primarily responsible on various summary totals in the SPT. The daily totals/recapitulations of journals shall be ticked-off upon posting to the corresponding control account in the General Ledger. Postdated checks received as payments shall not be recognized as collections until the arrival of their maturity dates. Every legitimate claim the validity of which is definitely recognized shall be properly recorded as a receivable. Trial balances, income statements,balance sheets and cash flow statements shall be prepared on a daily basis. Subsidiary ledger totals shall be reconciled with corresponding control accounts in the General Ledger at least once a month. All used-up ledger, journals and other books of accounts shall be placed in safety fireproof storage under the restricted custody of the Accounting Division Head and made available for audit at any reasonable time. 9. Monitoring Control Considerations The replenishment for the various revolving funds shall be subject to random and/or detailed review by the Business Department Manager and Audit Department. All collections and all funds are subject to yearly cash counts by the Audit Department and the External Auditor as part of the yearly financial audit exercise. All unaccounted fund overages identified during cash counts shall be credited to the coop as miscellaneous income. Shortages, on the other hand, shall be charged to the account of the Accountable Officer. Accountable forms shall also be subjected to inspection, count and/or review on a surprise random basis by the Audit Department. All bank statements and paid checks sealed by the bank shall be delivered directly to the Audit Department Head. Bank accounts shall be reconciled at least once a month by the Financial and Compliance Audit Staff of the Audit Department. Bank reconciliations shall include accounting for all check numbers, signatures, endorsement, payee's name, date, comparison with records, identification of unrecorded bank credits/debits, outstanding checks and deposits in transit. All long outstanding checks shall be reported by the Audit staff to the Business Department Manager for proper follow-up and control. All reconciling items shall systematically followed-up and promptly cleared. Direct confirmation of receivables shall be conducted by the Financial and Compliance Audit staff at least once a year.

 All accounts written off shall be subjected to post-audit. Spot checking of Bundy card entries vis-a-vis actual attendance shall be conducted on a random, periodic or surprise basis. The General Manager shall, from time to time, check Overtime Authorization Slip claims against time records in which the actual time-ins and time-outs of employees are logged. Business machine and computer breakdown shall be subject to on-the-spot observation/inspection and post-review by the representative of the Audit committee All disbursements approved in excess of approved budget shall be subject to post-audit. Disbursement transactions whose checks were both signed and countersigned by coop paid staff shall be subject to random review by the Audit Department. Plans and budget shall be subjected to post-review by the performance Audit staff, Audit Department. Cash Management policies and practices, system and procedures shall be subject to continuous policy review and evaluation by the Systems Audit Staff, Audit Department. Cash transactions shall be audited to ensure compliance with policies and implementing guidelines. The periodic performance of the cash management function as a whole as well as the various responsibility centers performing cash management function shall be subjected to audit. PLANNING AND BUDGETING Policy Control Considerations - Adequate, clear and understandable budgeting policies. - The planning and budgeting policies, shall be designed to encourage/allow individual members concerned to participate and cooperate in the planning and budgeting processes. - The budgeting policies shall allow the individual members, officers and employees enough motivation, freedom and authority to influence, contribute and share in the making of the budgets set for their respective segments. - The budget policies shall further strengthen controls and other safeguards to maximize yields/outputs through minimized costs of inputs/resources. - The budgetary policies shall be structured such that there is a reasonably great chance of attaining the goals set for each segment/division/committee and PT in order to further attain the coop's-wide objectives in line with its life purpose, mission and vision. - Clear-cut budget policies and guidelines shall be developed, formulated and implemented on the making of the various income forecasts and financial budgets to ensure success of the budgetary system. - Shall be reflective or coherence, harmony, unity and integrity between life purpose, vision, goals, missions, priorities and plans and individual desires and disciplines. - Allow proper balancing among processes and important activities of individual roles each is supposed to play, to achieve the coop's goals as well as the individual's personal goals thus making them more productive and efficient in the process. - Ensure the paramount importance of effective leadership before efficient management. - Policies on the control 3.Costs/Expenses Planning Considerations - Definite plans and objectives as well as methods and programs on Costs/Expenses shall be set in harmony with economic and social goals of this coop. - The various divisions/committees/PTs, as cost centers, shall plan and program their respective costs and expenses. - Costs/Expenses budgets/plans shall be accomplished, accurate, zero-based, quantified in pesoterms and made in application of relevant techniques. - Costs/Expenses budgets shall be so planned and prepared because such budgets, once approved, shall serve as basis and determinants for coop's future actual cost and expenses.

- Costs/Expenses shall be ascertained as to necessity and reasonability. - Certain costs/expenses analysis shall be planned hand in hand with corresponding activities or targets/objectives. 4.Revenue Forecasting Considerations - Clearly defined revenues-standards and policies shall be set to serve as guidelines in the making of revenue budgets - The afore-mentioned standards and policies shall be in line with the coop's goals and responsive to the demands/needs of the members. - The term revenue , for this purpose, shall mean interest income that this cooperative expects to generate. - Revenue budget shall be accurate, accomplished, zero-based and made in application of combined relevant techniques, like trend analysis, correlation analysis and internal estimates approach. 5.Financial Cash Flow Planning Considerations - Basic policies and objectives on cash management planning shall be set in order to optimize balances in meeting short-term needs. Any excess cash shall be invested in income generating assets/projects - Realistic, reasonable and measurable estimates shall be projected so as to plan beforehand appropriate courses of action even before the possible occurrence of any cash shortage and overage. - Cash flow planning shall be in accord and in line with the policies, controls, considerations, objectives of this cooperative's cash management system. - The cash flow plan/cash budget shall be used to 6.Capital Investment Planning Considerations - Shall formulate clear and adequate investments policies and guidelines reduced in writing to ensure proper planning and prioritizing of investment projects. - Clear goals relating to the investment of coop funds shall be established. - Plans for the acquisition of capital investment projects/assets shall be adequately planned, evaluated and discussed in terms of planned or proposed financing schemes. - Plans for investment of funds not yet needed for operations shall be so planned at such levels were risk is minimized; liquidity is optimized and income is maximized. - In the process of evaluating capital investment plans, various analytical techniques and tools shall be considered to ensure the profitability and economic worth of the project proposal and the risk involved shall be thoroughly taken and the variability of possible returns shall be assumed in relation to a wide range of factors. - The afore-mentioned investments proposals/plans once finalized shall pass board approval before being interlocked with the budget plans for the year. 7.Time/Range/Perspective Planning Considerations - Long-term perspective - Medium-term perspective - Short-term perspective

Employee Relation Policy

Employee relation policies are guidelines on how organizations plan to manage people. The policies define the values, philosophies of an organization and this gives principles that managers are to us in management of staff. These policies are the formal rules and guidelines that businesses put in place to hire, train, assess, and reward the members of their work force. These policies, when organized and disseminated in an easily used formsuch as an employee manual or large postingscan go far toward eliminating any misunderstandings between employees and employers about their rights and obligations in the business environment.

The policies provide a frame work through which consistent decisions are made and thus promote equity. Proposed policies for our organization 1) Employment (Engagement) Policy Recruitment Interview Selection & Posting (Placement) Induction Probation Confirmation 2) Performance Management Policy Appraisal Balanced Scorecard Performance Contracts Work plans 3) Compensation (Reward) Policy 4) Code of Ethics & Conduct Sexual Harassment HIV/Aids Conflict of interest Dress code Working Hours 5) Discipline Policy & Procedure 6) Staff Benefits Allowances Loans Parking for staff cars Staff canteen & clinic Daycare Medical Covers & insurance 7) Retirement Benefits Scheme 8) On-Job-Rotation 9) Transfer Policy 10) Statutory Contributions Policy 11) Education, Training & Development 12) Team Building Policy 13) Health, Safety & Security at workplace Fire/ disaster assembly point First aid Clean drinking water 14) Email and Internet Policy 15) Leave Policy Annual leave Compassionate leave Maternity leave Paternity leave Sick leave Study leave Leave of absence Unpaid leave 16) Misuse of Organizations property Traveling policy

 Trade unions policy CSR policy All these policies when compiled in one booklet may be referred to as staff manual. Policies depend on the strategies of an organization. These policies must be in line with the labor laws, human rights and the constitution. The policies should also have a clause on how they can be amended to incorporate any changes.

Production Policy
Product Policy Meaning of Product Policy: Policy can be defined as the broad guidelines relating to a particular matter. Policies are framed at the top level of management e.g. Board of Directors. Thus, Product policies are broad guidelines formulated by the top management of the company with regard to product planning and development. Therefore, product policy can be termed as long-term planning and management of its product-mix by a marketing company in order to achieve maximum consumer satisfaction. Objectives of Product Policy: 1. Survival: -The prime objective of a marketing company is to keep itself in the market. An effective product policy aims to follow strategies to keep the products in the market. 2. Growth: -After securing the survival objectives, the next objective of product policy would be growth. Product policy is formulated in such a manner so that it provides development of marketing operations according to long-term planning of the company. 3. Flexibility: -Though product policy is designed for a longer period, it becomes necessary to evaluate the effect of emerging trends in marketing. One of the objectives of product policy is to keep flexibility so that it could be changed according to newconsumer aspirations and needs, government rules and regulations. 4. Maximum Resource utilization: -One objective of the product policy is maximum use of various resources of the company. Product Policy is designed and altered in such a manner that the company can adequately utilize its various resources e.g. utilization of surplus funds, full production up to installed capacity, use of idle resources, maximum exposure to managerial talent and sale force of the company. Product policy generally covers the following 1.) 2.) 3.) 4.) 5.) Product Product Product Product Product Planning and development mix packaging positioning branding