Index

1. Project Objectives and Core Values

2. SHG Concept

3. Group Management norms and Financial norms in SHG Meeting

4. Need and importance of Bookkeeping for an SHG

5. Bookkeeper Concept

6. Bookkeeper selection criteria

7. Bookkeeper role and responsibilities

8. Do’s and Don’ts of a Bookkeeper

9. Books of accounts be maintained in an SHG

10. Bookkeeping Flow Chart

11. How to write Various Books of accounts

a. Meeting Minutes Book

b. Attendance cum Savings Register
c. Cash Book
d. Loan Ledger for Small and Big Loans
e. General Ledger
f. SHG Member Savings cum Loan Pass Book
g. SHG Maasanivedika

12. SHG Bookkeeping Training Plan

Page 1 of 27
Indira Kranthi Patham

1a. Project Objectives:

1) To organize the poor house holds into their own institutions

where the members will harness their potential and come out
of Poverty.

2) To provide constant facilitation support to these organizations

so as to enable the members to participate fully and directly
and take decisions on all issues affecting their lives.

3) To create and develop a large pool of social capital in the

institutions of the poor for providing continuous support in their
Endeavour to come out of poverty.

4) To build a sensitive support mechanism for these

organizations of the poor to emerge into self-managed and
self-reliant institutions and work independently beyond the
project period.

1b. Core Values of the Project :

1. Belief in the power of the poor.

2. Sympathy and empathy towards the disadvantaged and

marginalized members of the society.

3. Honesty and integrity

4. Respect the human dignity and individuality of the poor.

5. Facilitate the poor to resolve their problems but not to arbitrate

them.

Page 2 of 27
2. Self-help Group concept

● Self-help group is an informal association of women from poor

households

● It is an organization in which members with similar socio-

economic conditions come together around a common interest.

● The size of the group normally consists of 10 – 15 members

● Self-help and mutual help are the core principles of the group

● The group provides equal opportunity to all its members to

participate in the meetings

● Members thrift and credit are the key elements for the group
development

● Members in the group take all decisions in their meetings by

democratic process and consensus approach.

Page 3 of 27
3. SHG Management Norms and Financial Norms.

After formation of a Self Help Group the members should conduct

group meeting and finalize the group management norms and financial
management norms

1. The members will decide and give a name to their group

2. The group will decide the meeting place; meeting day and time for
their regular meetings.

3. The group should conduct weekly meetings.

4. The members of the group will sit in a round manner in their

regular meetings to facilitate face to face discussion and achieve
active participation of all the members in the decisions.

5. The members of the group shall elect two representatives from

among the members through consensus.

6. The group shall designate one of the members by rotation to

preside over the regular weekly meeting.

7. The group shall introduce and maintain relevant Books of

Accounts.

8. The group shall identify and engage a trained bookkeeper to write

the Books of Accounts and pay the remuneration from their
earnings.

9. The bookkeeper shall be either a literate member of the group or

an outsider willing to work with the group.

10. The members through consensus will finalize the norms for
imposing fines on absentees, late comers and defaulters as a
deterrent so that the group activities will sustain for a longtime.

11. The members of the group shall decide the weekly savings to be
contributed by the members to the group based on the ability of the
poorest women.

Page 4 of 27
12. The group shall open a Bank Account in the name of the group and
authorize the two representatives to operate the account.

13. All decisions shall always be taken in the group meeting through
democratic process and consensus approach.

14. The group shall take up internal lending to the members from the
group fund by prioritizing the felt needs of the members based on
poverty status.

15. The group shall fix interest rate and installments for the loans given
to the members and recover the principal and interest as per the
installments.

16. The group shall conduct all transactions like writing the records,
sanctioning and disbursing of loans in the group meetings only.

17. The group records shall always be in the custody of the group
representatives, but not with the bookkeeper nor with any other
member.

18. The group shall conduct at least one transaction in a month with
the Bank

19. The group should decide the minimum cash balance to be

maintained with group representatives for meeting the emergency
needs of the members.

20. The group should decide the norms for the admission of new
members and withdrawal of old members with regard to their
savings contributions and returning of savings.

21. The group shall introduce a Masanivedika about its performance

and it shall be prepared by the Bookkeeper in the last meeting of
the month.

22. The group should get their records audited once in a year.

Page 5 of 27
4. Need and importance of Bookkeeping for an SHG:

1. To record all the transactions of the SHG in a continuous manner

for enabling the members to understand them.

2. Decisions taken by the group will be known to all the members

from time to time and it will promote them to take always right
decisions in their meetings.

3. Bookkeeping will help in assessing the financial status of the group

like member’s savings, loans, attendance, group fund, recovery
percentage etc.

4. It helps in building confidence and unity among the members.

5. It promotes institutional development by increasing the credit

worthiness of the group.

6. It enables the group to monitor its performance.

7. By good Bookkeeping arrangements the scope of the group to

attract out side resources like Bank and other agencies will be
accomplished.

8. Good Bookkeeping arrangements create transparency of its

transactions to its members leading to strengthening and
sustainability of the group.

9. It brings recognition to the group in the eyes of the public

institutions.

10. Bookkeeping helps in rating of the groups performance.

Page 6 of 27
5 . SHG Bookkeeper Concept:

1. In every SHG since there will be thrift and credit transactions, there

shall be a Bookkeeper to write the books of accounts of the group.

2. The Bookkeeper is either a literate member of the group or an

outsider engaged by the group.

3. The Bookkeeper writes all the records in the group meeting only.

4. The Bookkeeper is a person hired by the group.

5. The Bookkeeper is paid monthly remuneration from the earnings of

the group.

6. Bookkeeper Selection Criteria:

1) A literate member of the group willing to work as Bookkeeper shall

be selected.

2) If there is no literate member, the group can select and engage an

outsider willing to work as Bookkeeper.

3) The Bookkeeper shall be a local person and shall be available for

all the meetings.

4) The Bookkeeper must have studied at least up to 7th class.

5) The Bookkeeper must be good at Arithmetics.

6) The Bookkeeper shall possess legible hand writing.

7) The Bookkeeper shall respect the women and be loyal to the

group.

8) The Bookkeeper shall not be a relative of the group leaders.

Page 7 of 27
 9) Women members shall be given preference.

10) The Bookkeeper shall possess patience and service mindedness.

11) The Bookkeeper shall be a person hailing from poor house holds.

7. Bookkeeper role and responsibilities:

1. Bookkeeper is a person engaged by the SHG and is

accountable to the group only.

2. Bookkeeper receives his remuneration from the group out of

its earnings.

3. Bookkeeper shall attend 10 minutes before stating of the

group meeting.

4. In the group meeting, the Bookkeeper will sit by the side of the
group leader.

5. The Bookkeeper will receive all the records from the Leaders,
write all the records during the meeting and hand over them to
the Leader at the end of the meeting.

6. During the meeting he will write the records and read out all
the decisions and transactions for the benefit of all the
members.

8. Dos and Don’ts of the Bookkeeper:

SNo. Do’s SNo. Don’ts

The Bookkeeper shall The Bookkeeper shall not

attend the meeting 10 involve in the cash
1 minutes before starting of 1 transactions of the group.
the meeting.

Page 8 of 27
 The Bookkeeper shall take
all the records from the
2 2
representatives in the
meeting itself.
The Bookkeeper shall write
3 all the records in the
meeting only.
The Bookkeeper shall read
out all the decisions and
resolutions for the
4 4
information of members in
their meeting as per the
Agenda from time to time.
At the end of the meeting
the Bookkeeper shall obtain
5 the signatures of all the
members in the minutes
book.
The Bookkeeper shall
handover all the records to
6 5
the group representatives at
the end of the meeting.
During the meeting the
Bookkeeper will bring to the
notice of the members the
information about important
7 items of the previous
meeting minutes, member
wise particulars of loan
installments to be repaid;
fines to be paid etc.,
The Bookkeeper shall be
8 willing to undergo all the
trainings.
9 The Bookkeeper shall
ensure that all the members
Page 9 of 27
The Bookkeeper shall not
influence decisions of the
group.
The Bookkeeper shall not
3 take away the records to
the house.
The Bookkeeper shall not
take loans from the group if
she / he is not a member of
the group.
The Bookkeeper shall not
indulge in bad practices like
8 tampering of records, over
writings etc.,
The Bookkeeper shall not
disclose the group
information, decisions and
resolutions to outsiders.
The Bookkeeper shall not
record any transactions
which are not taken place in
the meeting.
6
The Bookkeeper shall not
7 be biased towards some
members.
 are able to sign and learn
simple arithmetics for
improving their functional
literacy.

The Bookkeeper shall

prepare SHG Masanivedika
in the meeting, read out all
the points for the
10
information and knowledge
of members and hand over
the report to the group
representatives.

The Bookkeeper shall Co-

11 operate with the audit staff
by giving all the information.

The Bookkeeper shall

12
respect the women.

9. Books of Accounts to be maintained in an SHG:

1. Meeting minutes book,

2. Savings cum Attendance Register,

3. Loan ledger for small loans and big loans,

4. Cash book,

5. General Ledger,

6. Individual savings cum loan Pass books for

members,

7. SHG Maasanivedika

Page 10 of 27
 10. SHG Bookkeeping flow chart:

Savings cum
AttendanceRe
gister

Minutes
Book
Cash
Book

Loan Individual General

Ledger Passbook Ledger

SHG Maasanivedika

11. How to write various Books of Accounts.

11a.Meeting Minutes Book

Importance:

1) This is the main book in which all the transactions, decisions

and resolutions are recorded by the Bookkeeper.

2) This is the source book for all other registers.

Page 11 of 27
 3) The SHG members shall ensure that all the transactions,
decisions and resolutions are recorded in the first instance in
the minutes book.

Meeting Minutes book Proforma:

Meeting No.

Meeting Date:
Meeting Day :
Meeting Time:
1. Name of the SHG :
2. Name of the Village :
3. Meeting place :
4. Name of the member presiding over the meeting :
5. Total No.of members in the SHG :
6. No.of members attended the meeting :

Agenda of the meeting:-

1. Prayer:- All the members present will sing the song of “”Jeevithana
gelupundhani ……”

- The Song will help the member to keep in view their common goal
and develop enthusiasm to achieve it.

2. Members’ introduction:

- Each member will introduce herself by her name, groups name,

village name, village organization name and her savings amount.

- The practice of members introduction will improve their ability to

speak freely without shyness and develop self confidence.

Page 12 of 27
 3. Members’ Attendance:-

- While the members were introducing themselves, the bookkeeper

will record the attendance in the register.

- The names of the absentee members and late comers and the fines
to be imposed will be recorded as per the group norms.

- This practice will act as a deterrent to the members and make them
alert and disciplined for their meetings.

4. Review of previous meeting decisions:

- The Bookkeeper will read out the decisions of the previous meeting
and the group will review the following items:

a. Fines to be collected from the previous meeting absentees

and latecomers,
b. Loan installments to be collected from defaulters of the
previous meeting,
c. Previous meeting savings not paid by members if any,
d. Purchase of assets through the loans disbursed in the
previous meeting,
e. Asset verification report on the loans by the non loanee
members,
f. Remittance particulars of cash balance of previous meeting in
the bank account,
g. Handing over the previous meeting cash balance to the
presiding member of the present meeting,

5. Collection of Savings:

- In the meeting the presiding member will collect the individual

savings from all the members and the Bookkeeper will record the
transactions including the names of the members not paid the
savings.

Page 13 of 27
6. Collection of loan installments:

- In the meeting the presiding member will collect their individual loan
installments, principal and interest from the members and the
Bookkeeper will record member wise transactions including the
defaulters in the following manner:

Proforma:

SNo Name of the Member Purpose Principle Interest Total

.
1
2
3
4
5
6
7
8

7. Sanction of new loans:

- In the meeting after collecting savings, fines and loan installments

the group will sanction new loans to the members based on the
priorities of the members and their needs. The Bookkeeper will
record member wise loans sanctioned in the meeting in the following
manner.
Proforma

Loan
Loan No.of
Name of the Purpos amount Interest
SNo. amount Install-
Member e actually rate
requested ments
sanctioned
1
2
3
4
5
6
7
8

Page 14 of 27
8. Community Investment Fund Loan from VO:

▪ Loan amount sanctioned by VO:

o No.of installments;

o No.of installments repaid;

o Monthly installment – Principle and interest;

o Installment amount repaid till the last meeting;

o Installment proposed to be paid as per the demand;

9. SHG Bank linkage:

▪ Loan amount sanctioned;

▪ No.of Installments;

▪ Monthly installment principle and interest;

▪ No.of installments repaid;

▪ Installment Amount repaid till the last meeting;

▪ Installment proposed to be paid as per the demand;

10. Receipts and payments statement;

The Bookkeeper will prepare receipts and payments

statement and place it in the meeting for discussion and approval of
the members.

Page 15 of 27
 Proforma:

SNo. Receipts Amount SNo. Payments Amount

Loans sanctioned to
1 Opening Balance 1
members
VO loan repaid
2 Savings received 2
(Principle)
VO loan repaid
3 Principle collected 3
(Interest)
4 Interest collected 4 Bank Loan repaid
Bookkeeper
5 Fines collected 5
Honorarium
Amount withdrawn
6 6 Conveyance Charges
from Bank
Amount deposited in
7 7
the Bank
8 8 Closing Balance
Total Total

11. Social issues:

The members will discuss on priority the social issues like child
labour, children education, nutrition support to pregnant and lactating
women, early child marriages, domestic violence, alcoholism etc.

12. Govt. Programmes:

Government programmes like NREGS, Indiramma housing, Pavala

Vaddi, Arogyasri etc will be discussed on priority.

13. Signature of the members:

At the end of the meeting the Bookkeeper will obtain the signatures
of all the members attended the meeting.

Page 16 of 27
11b. Attendance cum Savings Register

Proforma:

Meeting No: Total

Total
Atten-
Date: Savings
dance
S
B/F
No B/F
Name of the Atte
Sav- A S A S A S A S A S
Member ndan
ings
ce
1
2
3
4
5
6
7
8
9
10

Importance:

- In this register member wise attendance and collection of weekly

savings are recorded by the bookkeeper.
- It gives the details of the number of meetings held, No.of meetings
attended, percentage of attendance, member wise total savings
collected, and total savings in the group.

11c. Cash Book:-

The Bookkeeper shall write the cash book during the meeting, he
will record all the transactions like savings collected, fines collected, loan
repayments, amounts withdrawn from bank including opening balance on
the receipts side and savings refunded if any, new loans sanctioned,
amounts to be remitted to the bank account including the closing cash
balance on the payments side and tally the cash balance.

- After writing the cash book the bookkeeper will make entries into the
loan ledger, individual pass books, general ledger, etc.,
Page 17 of 27
 Cash Book Proforma:

Gener Gener
Minute Minute
Receipts al Payments al
Dat s Book Amou Dat s Book Amou Balanc
Particulate Ledger Particulate Ledger
e Page nt e Page nt e
s Page s Page
No No
No No

11d. Loan Ledger for Small and Big loans

Small Loans

The members take various small loans in the weekly meetings for
consumption, health, education etc.. These small loans will be recorded in
the loan ledger indicating loan amount, Purpose, No.of installments,
Interest etc.

Small Loans Proforma:

Due Amount
Date Signa-
Date of Amoun No.of Date Repaid Over
Pur of Loan ture of
Disbur t Disbu Install for (Principal Due
pose Repay Balance the
sement rsed ments Repay + (P+I)
ment Member
ment Interest)

Page 18 of 27
Big Loans

The members take various big loans for investments in income

generating activities and several other purposes. These loans will be
recorded in the loan ledger indicating loan amount, date of disbursement,
No.of loan installments, interest etc.

The members can take small loans and big loans simultaneously
as per their needs.
Big Loans Proforma:

Name of the Member: Period of Installments:

Husband’s Name Installment Amount Rs:
Cash Book Page No. Amount Sanctioned:
Date of Disbursement Rate of Interest:
No.of Installments Purpose:

Revenue
Stamp

Signature of the Member

Repayment Schedule

Amount
Insta to be Loan Cash
Date Repayment
llme Repaid Over Due Particulars Balanc Book
S of Particulars
nt Including e Page No.
No Repay-
Due over due
ment
Date Princi Inte Prin Inte Princi Inte
Total Total
pal rest cipal rest pal rest
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
Page 19 of 27
11e. General ledger:-

- In the general ledger head of account wise folios are allotted. The
Bookkeeper will post entries under each head of account from the
cash book.

- From the general ledger balance available under each head of

account will be known.

- From the general ledger the Bookkeeper will prepare receipts and
payments statement and income and expenditure statement if
necessary.

Index Proforma

S No. of Pages Allotted

Name of the Account
No. From To
1 Members savings
2 Loan Sanctioned to Members
3 Principal collected from Members
4 Funds received from VO
5 Funds received from Bank
6 Funds received from other source
7 Income heads
a) Interest received from Members loans
b) Fines
c) Resource Fees
d) Interest on Bank Balance
e) Other Incomes
8 Expenditure heads
a) Interest paid to VO
b) Interest paid to Bank
c) Bookkeeper Honorarium
d) Conveyance Charges
e) Miscellaneous Charges
Page 20 of 27
Page 21 of 27
 Proforma:

Members Savings Account

Cashbook Total
Date Savings Collected Savings Repaid
Page No. Savings

Loans Sanction to Members

Total Loan
No.of Total No.of Loan
Cashbook Amount
Date Loans Loans Amount
Page No. Sanctioned
Sanctioned Sanctioned Sanctioned
(in Rs.)

Loan Amount Collected from Members Account (Principal)

Cashbook
Date Amount Collected Total Amount Collected
Page No.

Page 22 of 27
 VO Loan Account

Cashbook Amount Amount Loan

Date
Page No. Received Repaid Balance

Bank Transaction Account

Amount Amount
Cashbook Bank
Date Deposited in Drawn from
Page No. Balance
Bank the Bank

Income Account

Name of the Income Head:…………………………

Cashbook Amount Total Amount

Date
Page No. Received Received

Page 23 of 27
 Expenditure Account

Name of the Expenditure Head:…………………………

Cashbook Amount Total Amount

Date
Page No. Paid Paid

11f. SHG Member Savings cum loan Pass Book:

- The group will supply each member with an individual savings cum
loan pass book where members savings, small loans, big loans
details will be recorded.

- Each member knows her savings in the group, small loans and big
loans sanctioned, installments repaid, overdue if any, and loan
balance etc.

- The Bookkeeper will write the members pass books in the meeting
and hand over to them respectively.

Proforma:

Savings Particulars :

Savings Signature of the

Date Others Total
Received Representative

Page 24 of 27
Small Loans Proforma:

Due Amount Signa-

Date
Date of Amoun No.of Date Repaid Over ture of
Pur of Loan
Disbur t Disbu Install for (Principal Due the
pose Repay Balance
sement rsed ments Repay + (P+I) Represe
ment
ment Interest) ntative

Big Loans Proforma:

Name of the Member: Period of Installments:

Husband’s Name Installment Amount Rs:
Cash Book Page No. Amount Sanctioned:
Date of Disbursement Rate of Interest:
No.of Installments Purpose:

Revenue
Stamp

Signature of the Member

Repayment Schedule
Amount
Insta to be Loan Cash
Date Repayment
llme Repaid Over Due Particulars Balanc Book
S of Particulars
nt Including e Page No.
No Repay-
Due over due
ment
Date Princi Inte Prin Inte Princi Inte
Total Total
pal rest cipal rest pal rest
1
2
3
4
5
6
7
8
9
10
Page 25 of 27
11g. SHG Maasanivedika:

Every month the group will prepare Maasanivedika. It contains the

details like no. of meetings to be held, no. of meetings actually held,
savings collected, percentage of members attendance, financial status of
the group in terms of loans borrowed from different agencies, amount
repaid, over dues if any, loan balance etc.

- It also contains income and expenditure statement of the group, a

detailed portfolio of the members loans in a separate format and any
other social activities taken up by the group etc.

- Maasanivedika enables monitoring of SHG performance on monthly

basis. The Bookkeeper will prepare this report once in a month in
SHG meeting and read out for the knowledge and information of the
members and handover to the group representatives.

- The group representatives will furnish their report to the Village

Organization(VO) in its monthly meeting.

Page 26 of 27
12. SHG Bookkeeper Training Plan:

S Metho- Partici- Training Resource

Subject Duration
No dology pants material Person
Project objectives: Charts,
Interactive
- Core values SHG Markers,
lecture Master
1 - Social ½ Day Bookkee Brown sheets
method Trainer
mobilization pers note books,
(ILM).
approach pens, pencils.

SHG concept:
- SHG
Management Interactive
and financial lecture
2 norms, ½ Day method and - do - - do - - do -
- SHG meeting role play
process technique
- SHG meeting
Agenda

Need and
importance of
Bookkeeping for
an SHG:
3 - SHG Bookkeeper 1 Day - do - - do - - do - - do -
concept, Selection
criteria, Role and
responsibilities,
Do’s and Don’ts.

Meeting minutes
Book:
ILM & Case
4 - Savings cum 1 Day - do - - do - - do -
study
Attendance
Register
ILM & Case
5 Cash Book ½ Day - do - - do - - do -
study
Loan Ledger &
6 Individual Savings ½ Day - do - - do - - do - - do -
cum Pass Book

General Ledger &

7 ½ Day - do - - do - - do - - do -
Maasanivedika

Evaluation and ILM & Case

8 ½ Day - do - - do - - do -
feed back studies
Refresher training after 3 months.

Page 27 of 27