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Title: Governance in Saving and Credit Associations Operating in Addis Ababa
???metadata.dc.contributor.*???: Habtamu B. Abera (PhD)
Meseret, Abebe
Keywords: Saving;Credit Associations
Issue Date: Jan-2017
Publisher: A.A.U
Abstract: Corporate Governance in Saving and Credit Cooperative Societies (SACCOs) is pivotal for such institutions having a peculiar nature of member-owner attributes. This study aimed at the assessment of governance practices in SACCOs. The study has targeted on three functional SACCOs in Addis Ababa of Ethiopian Electric Power Corporation (EEPCo), Ethiopian Airports Enterprise, & Catholic Relief Services. Purposive sampling techniques were used to gather data from the selected SACCOs. Pertinent data were collected through primary data sources using structured questionnaires and secondary data sources. Data collected has been entered, edited and analyzed using SPSS tool. Based on the study, there are no consistencies as to ownership within the SACCOs. The Board size ranges from seven to nine members in these SACCOs with limited representation of female members at around 30% of total board size. The study identified challenges in conducting periodic meeting and performance assessments at Board level. Annual audits in the SACCOs were not conducted timely after closure of a fiscal period. Trainings related to governance and management of SACCOs was not adequately provided to Board members. Incentive schemes either in cash or in kind for Board members are poor, if not none at all like at CRS. SACCOs mostly pay an annual interest rate of 5% on saving depositors which is the risk free market rate offered in most commercial banks on saving accounts. Interest rate on loans of the three SACCOs remains stagnant ranging from 6% to 8% which doesn’t consider at least yearly inflation and time value of money. Finally, it is commendable to consider on a clear definition of ownership, improving capital adequacy position, periodic and timely supervision and audit, strengthening sound financial discipline in optimal utilization of huge savings mobilized to productive loan portfolios and better investment opportunities. It necessitates revisiting interest rates both on savings and loans to reflect administrative costs, cost of funding, inflation and elements of capitalization.
Description: A Thesis Prepared in partial fulfillment of the Requirements for the Degree of Master of Accounting and Finance (MSc.)
Appears in Collections:Thesis - Accounting & Finance

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