Page 15 - rural-final-inspection-report-september-2016
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The performance of the Association as indicated by the operating

margins, interest cover and gearing levels is good. The Association is
efficient at managing its cash through its cashflow forecasting and

budgeting, with the three year rolling cash forecast updated weekly.
The Association however has a low current ratio, and at times cash

reserves do not align with their treasury management policy. This is

planned to be alleviated by the securing of a loan with the Bank.

The recommendations therefore are aimed at enhancing and
developing the organisation’s financial and governance arrangements

to meet future challenges. Details of the findings are recorded in the

following paragraphs.



Findings


(b) Financial Planning and Monitoring


2.3 Budgets
Annual & long term budgets have been well prepared. Finance

Committee & Board minutes indicate an appropriate level of

involvement in review of budgets and it is evident that the budgets are
being discussed and approved at various points throughout the year.

The recommendations will enhance the budgeting process and the

review of budgets by management and the Board.


It is recommended that:
a) The Association includes in its budget a comparison to the prior

year budget and actual performance in prior period to enable a
greater understanding of the current budget.



b) Assumptions are included in the long term forecasts to enable
management and Board to adequately scrutinise the figures.





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