INFORMATION SYSTEM FOR MANGGAGAWA NI SAN JOSE MULTI-PURPOSE COOPERATIVE
A Thesis Proposal Presented to the faculty of Informatics International College Diliman Quezon City
In Partial Fulfilment of the Requirements for the Degrees Bachelor of Science in Information Technology and Bachelor of Science in Computer Science
Emmanuel T. Dimasacat., BSIT Odell Ryan C. Rotol., BSCS Patricia Anne A. Kalalo., BSIT
2nd Term S.Y. 2013-2014
TABLE OF CONTENTS
TITLE PAGEi TABLE OF CONTENTSii CHAPTER 1 THE PROBLEM AND ITS SETTING1 A. Introduction 3 B. Background of the Study5 C. Conceptual Framework12 D. Statement of the Problem13 E. Significance of the Study15 F. Scope and Delimitations17 G. Definition of Terms21
CHAPTER 1 THE PROBLEM AND ITS SETTINGS A. Introduction
Automation is very popular now a days because of its potential to do things much faster, accurate and reliable to every human being or businesses that is using it. Any kinds of businesses, organizations or anything that is dealing with manual system can possibly be helped by a computer because of a powerful software that can process information from inputting data to the computer and process it to become a useful output for their clients or their beneficiaries. Financial Management is one of many systems that is being used by some system developers who manage to do an automated system for helping businesses that offers financial services like savings, loans, insurance and others. One example of an organization that offers savings and loans services is a Cooperative. There are actually several kinds of Cooperatives and the proponents subject to this study is a Multi-Purpose Cooperative wherein they offer savings, loans and some items and services that can be helpful to their members like dental/medical loan, merchandise loan like rice and more.
The Manggagawa ni San Jose Multi-purpose Cooperative was organized on March 11, 2010. Organizers were officers of the BPC-Barangay Pastoral Council of San Jose Manggagawa Chapel located at barangay San Jose Rodriguez, Rizal, where they adapted the name. Headed by Mr Roland C. Nery, and was then encouraged his co-Pastoral officer Mrs Ma. Salome Tappa and Mrs Felicidad Avena and some officers of the council and they formed the organization with their intensions of helping the Barangay Pastoral Community . After searching for the proper documentations, they then realized to bring the concern to Rev. Fr. Rowie Reyes to organize the same because the BPC San Jose is under his Parish and also encouraged him as one (1) member of the Board. Consisting of five (5) members of the Board, Mr Roland Nery, Mrs Salome Tappa, Mrs Felicidad Avena, Mr Emilio Manalang Jr., and Rev. Fr. Rowie Reyes, followed by other cooperators totalled to twenty five (25) members, valued the required share capital of each first twenty five (25) cooperators and prepared the required documents like “By-Laws, Articles of Cooperation, Feasibility Study, Economic Survey, Board Resolution, etc.”, in order to be registered.
While still looking for prospective and potential members, they started operating for almost a year before the completion of the required documents. Dated March 24, 2011, the first cooperative name they registered at Cooperative Development Authority (CDA) Quezon City was “San Jose Manggagawa Credit Cooperative” and found out that the cooperative name that they had applied for is no longer available they again applied as ‘Manggagawa ni San Jose Multi-Purpose Cooperative’. submission of the required documents was delivered at CDA- Calamba Laguna Extension office on April 13, 2011. Registration Certificate was then issued on May 16, 2011. Temporarily, the ‘Manggagawa ni San Jose Multi-Purpose Cooperative (MSJMPC) occupied the office at San Jose Manggagawa chapel for more than one (1) year, with seventy eight (78) members. To date, they move out to occupy an office at cor. Kalantas Street San Jose Rodriguez, Rizal, now with three hundred thirty three (330) members, both regular and associate. B. Background of the Study
Manggagawa Ni San Jose Multi-purpose Cooperative is one of many organizations that offers financial related and mutual funding services like time deposits, loans and savings as well as the emergency loans for helping people mainly in Rodriguez Rizal to finance their needs for their own businesses or helping them to establish their own livelihood with some requirements that a regular citizen can provide. MSJMPC was organized by twenty five people’s mostly church servers and members of Barangay Pastoral Council of San Jose Manggagawa Chapel in the late part of 2010. Temporarily, the ‘Manggagawa ni San Jose Multi-Purpose Cooperative (MSJMPC) occupied the office at San Jose Manggagawa chapel for more than one (1) year, with seventy eight (78) members. To date, they move out to occupy an office at cor. Kalantas Street San Jose Rodriguez, Rizal, now with three hundred thirty (330) members, both regular and associate. Services of MSJMPC is truly helpful for its members and valuable clients but on the other hand as time passes by, members of MSJMPC keeps on counting and there is a possibility that their staff will no longer handle more transactions of payments and other services for their members. This study aims to find out and to have a solution on how to made the daily transactions of MSJMPC be easily and convenient without adding more staff for the collections of payment.
At the present, MSJMPC has an existing system using MS Excel to organize their records for their members and daily transactions of their financial services. In part of the management side one problem is there are a lot of redundant records such as members profile and even the non-active members that are not separated in the database using a spreadsheet program as well as transactions that is created using the current system. Another thing is that not all of the staff has a full understanding on the technology of the software that they are using and a spreadsheet program is only used to perform basic mathematical operations for computing the daily transactions and not database management software.
Another problem is that there is also a staff that collects payments to members door to door that avail loans and savings so that they can give better services to their members so that if a member is so busy with his/her business or anything that they are busy with they don’t have to worry about going to the office to pay their loans and savings. But in the part of MSJMPC having 300 plus active members it is hard to collect payments if the records of the members in computer were not properly documented and sorted. Also the transactions from the daily collections must be sorted out and analyzed and to be placed in a General Ledger book so that the Board of Directors will have a summarized record and use those records for a basis of their decisions in the organization. And to resolve these current situation researchers used this opportunity to study on how to resolve their problems by applying a modern and specific program to manage their needs and to organize the data to have a better service for their members.
This new system will enable a lot of features such as faster searching of members profile with information about their transactions and contributions and monitoring their payments thru the reports that the system will be generated daily, weekly, and monthly or annually depends on the needs of their members and their internal committees and board members. Thru this new functionalities, the members can now easily get some reports about their balances and contributions because even if the members have their own passbooks and daily collection slip as their statement of accounts, there are some instances that if they lost these important documents and their records in the MSJMPC are not properly documented, all of their hardships and contributions will be lost so the backup of their data is very important.
C. Conceptual Framework
In this part of the study pertains to the current system and the proposed system for MSJMPC presented graphically illustrated with brief details of the processes inputs and outputs in the system. Manual System
Before anyone can avail loans and other services from MSJMPC, they must be a member first. There are two kinds of membership, one is a Regular Member and the other one is Associate Member. For membership application processing, they need to fill up the application form from MSJMPC and bring some required documents like three pieces of 1x1 picture, photocopy of valid id, proof of billing, and business permit for others who has a business then they must attend the Pre-Membership Education Seminar or PMES. Applying regular member who are working must submit a pay slip or a certificate of employment as proof of income and must signed and agree to the Subscription of Agreement also they will be subscribed to one hundred sixty (160) common shares or sixteen thousand pesos (Php 16,000.00) and pay the value of at least forty (40) common shares or four thousand pesos (Php 4,000.00) initial share capital and paying in such amount in lump sum or in regular installments for two (2) months; if non installments, to pay at least the value of one share or one hundred pesos (Php 100.00) daily on or before the approval of membership by the Board of Directors (BOD).
They also need to pay for membership fee of two hundred pesos (Php 200.00) then a representative from the Credit Commission (Cre-Com) or from the management will conduct a Credit Investigation so that they can assure that the person who want to avail loans and other services has the capability of paying. Then after those screening process this is the time when the bookkeeper will put the information from application form to computer in MS Excel. After the approval of the membership application, a member will be given an assigned ID that contains useful details that will be needed in the future use. Then two kinds of passbook will be given to them, one is for savings passbook and the other is loan passbook. The reason why these passbooks were separated is for the member to easily monitor his/her savings if it is growing or not and to easily monitor the balances of their loan and these two credit services are in different accounts. Loan is one of the services that the MSJMPC is offering and for this service after being successfully applying a membership application and be approved, a member must pay his/her share capital based on duties and responsibilities as a member. If the member pays the initial share generally the MSJMPC will double the initial share for the amount of loan that the member will get. The management will ask the member if what is the purpose of loan for which the money to be used and then discuss the terms and mode of payment because these are essential attributes that the management needed to know and for them to compute the total deductions of loan aside from the percentage of interest.
There are some mode of payments that the member will choose and from that, the computation of interest or deductions will be based so the more it will be longer in terms of payment the more the percentage increased. They use excel forms for this computations but this is not yet linked to the profile of the member that is borrowing from the MSJMPC. Then after computing the loan, they will process it for releasing of cheques or cash. Usually it takes one week for the whole process. Then when releasing period comes, the borrower must present the passbook to record the amount of loan and in the credit application they must attached with the loan release form with the amount of loan, kind of loan, mode and terms of payment. Another process is when the collector officer needs to collect some payments like the daily collections of loan, savings, share capital, and merchandise loan it was actually hard for his part to monitor it if the records of the members were not properly encoded to computer from the three hundred plus person needs to be collected daily but the officer got the skills and techniques to do his job. When the collector arrives to the destination he will ask the member to show their passbook and how much they will pay for their savings, loans and share capital so that he will able to put the payments to the passbook and he also has a copy of the payment slip then when he finishes his collections put it into computer. In purchasing items for their services they also need to put it on their purchase journal in excel they will input the details of the items such as price, item description and its quantity then it will store in excel for records then if they need to have a printed copy they just print the record from excel for other purposes.
Another business that the MSJMPC engage with is that they also offer Merchandise Loans. This includes rice and gift certificates from a supermarket that they are partnering with. For this part they need to put it on a logbook if who is the member that avails the merchandise and if they pay it cash or cash collateral using their savings or categorize it as merchandise loan. Usually they use merchandise loan if they want to buy a sack of rice which is payable for maximum of fifteen (15) days then they will also generate an invoice if the member wishes or just put it on their records in logbook and in sales journal using excel but they don’t have a proper inventory records for those items. When MSJMPC pay they categorize it as cash disbursement whether they categorize it as assets or liabilities or any form of payment to settle obligations such as operating expenses, interest payments for loans and accounts receivables during a particular period in order to carry out business activities they record it as cash disbursement but still these records were not completely documented in computer. They usually process it by posting first these disbursements so that it will be categorized and summarized in chronological order and put it to their records in excel and in logbooks.
Then they will process the releasing of money for the payment. When purchasing goods for their merchandise they also record the items on a logbook based on the purchase order receipts. The main process of it is just recording the purchase entries with their corresponding amount and no. of items and their total costs then put it on a purchase journal. Same thing with selling the purchased merchandise but they put it on a sales journal but the problem to this is that the entry of items in sales and purchase is redundant because in an inventory only the number of stocks is changes whether it decreases or increases. Then the last cycle on this system is to post all the journals from the collections, cash disbursement and the purchases and sales journals. After these journals were posted it will be put in a general leger and in a trial balance and the final output of it is to create a Financial Statements Proposed System
In the proposed system all processes will be the same it’s just that using the new system all of the transaction of a member are all linked to their information because of the relationships inside the database, no more redundancies and they will have a proper categories under the management of the database and also these information will be validated properly and using this new system, it will create reports and can now sorted properly. In part of the collector all he needs to do is just print or check in to the system if who are the members that needs to be collected daily using filtering functions.
And using this system will also decrease the processing period of applications of loans and membership because they will now put all the information direct to the system but if the member wishes to fill it up at home the system will just generate an application form. Processing of inventory will be easy using this system because when they put entries of their purchased merchandise and sell those the system will automatically update or deduct the sold items in to the current stocks. Generating financial statements, general ledgers and trial balance will now be easy fast and convenient for the BOD to get updated but still there are some manual process that they cannot avoid even if they use this new system because decision making cannot generate by a system. And all of these functionalities can be done only by an authorized personnel because they must have a username and password to access the system. In this system also includes the payroll for the staff because at the present the manager usually process it also in excel but now the system will do it so that they can now concentrate more on accounting processes.
D. Statement of the Problem
This section of the study specifies to the issues, problems and other concerns that might influence the arrangement of the proposed system. 1. What are the benefits that the stakeholder may be acquired from the proposed system? 2. What are the common problems presented in the current system that might be resolved in the proposed system? 3. Is there any significant process and output between old system and the proposed system? 4. Does the proposed system generate the necessary information needed by the stakeholder? 5. What is the significance of the proposed system towards the stakeholders in terms of organizing a report? E. Significance of the Study
This study will be beneficial to the management and to the members as well of the whole team of MSJMPC in managing their organization. This system will lessen the use of paper-based forms by recording or monitoring the transactions into a database. Listed below are the benefits of the proposed system:
1. Members – they will not be worry about losing their passbooks because their transactions with the MSJMPC will be accurate and stored in a safe database storage.
2. Personnel – encoding and manipulating the data of every processes will be easier for them. The system will also give an authorization access level to every staff so if they don’t have the rights to access the internal data, the new system will not allow them to see it and change it. Redundancy of excel files will also eliminated and managing the database of the members and their contributions can be easily monitored. They can also make the process of their credit services and membership application faster and accurate.
3. BOD – the system will provide a summarized reports and statistics about the financial status of the organization and with that, they can easily make some decisions and actions for making the organization more functional and financially stable. 4. Proponents – this study
5. Future Researchers – this study will give a brief overview and an idea on how a certain multi-purpose cooperative functions and how to resolve their problems using a manual system and enhance this current study. This will also give benefits to them when conducting a financial management system.
F. Scope and Delimitations This section explains the coverage and the boundaries of the study. It presents briefly the functionalities of the system based on the investigations of the researcher to the environment and the circulation of the current system that needs to be improved. Scope:
The proposed system provides a security feature that limits the user to open the system because the system requires a username and password, and covers the entire processing of the previous system of membership application process, transactions of MSJMPC from savings, time deposits, to any forms of loans processes and also the inventory process of the merchandise and the payroll computations for the staff and all of these functionalities made possible thru the use of Visual Basic. All the data entered in the system will store in a safe storage using MS SQL Server and using this as a backend will allow the system to connect or linked all the information of members to their transactions.
The system will generate useful reports of several journals and summarized financial statements that the BOD needs thru a technology called Crystal Reports in Visual Studio. The system will generally run on a server used and monitored by the manager of the MSJMPC and there will be a sub applications also that will be facilitated by the loan officer, collector or cashier and the bookkeeper with respective functionalities that they only need. They have different access levels in the system so that the system will limit its functions to the user of it. Also payroll is included in the new system so that all of the task needed by the management will be accomplished. Delimitations:
Like other systems, the proposed system has also its limitations and one of it is the collections of payment, because the system can only process transactions but not the processing of collections directly from the members to the system but this feature might be possible with the use of SMS technology or the Electronic Money Transferring. Inventory Processing is also one of the functions that has a limitations because the system only fetch a input from the user if there is a transaction of adding and removing in number of merchandise items but the system cannot monitor the real numbers of stocks. In terms of accessibility of the system only the staff in the office can use the system unlike to an Online Systems that even they use a smart phone they can still access and explore the data of the system. G. Definition of Terms
Cooperative Development Authority or CDA - is a government agency created by virtue of Republic Act No. 6939 in compliance with the provisions of Section 15, Article XII of the Philippine Constitution of 1987 which mandates Congress to create an agency to promote the viability and growth of cooperatives as instruments for equity, social justice and economic development. RA 6939 was signed into law on March 10, 1990. Multi-Purpose Cooperative - it is a combination of two or more types of the business activities of different types of cooperatives like credit, consumer, marketing and service cooperative.
Regular Member - must be in legal age and a resident of Rodriguez, Rizal, has fulfilled the minimum requirement for share capital and other requirements with some privileges of availing credit services, saving facilities and others, has the right to elect and be elected as Board of Directors (BOD) and Committee officers and has the right to contribute, open to give suggestions and take part during General Assembly (GA) meeting. Associate member - the applicant who wants to be a member can be a foreigner and not a resident of Rodriguez, Rizal and they can availing credit services, saving facilities and others but has no right to elect and be elected as Board of Directors (BOD) and Committee officers but has the right to give suggestions like for the improving the services of MSJMPC. General Assembly (GA) - A General Assembly is the highest policy-making body of the co-operative and is the final authority in the management and administration of the affairs of the co-operative. It is composed of members who are entitled to vote, duly assembled and constituting quorum. The general assembly holds at least one meeting a year; the date of the meeting is fixed in the by-laws, or within 90 days after the close of each fiscal year. Board of Directors (BOD) - they are the ones who to set grand strategic goals and develop an overarching vision for the organization they are also responsible for recruiting and hiring executive level managers in the organization as well as the policy-making body when it comes to big-picture issues such as financial responsibility, equal employment opportunity issues, compliance with applicable legal guidelines and the co-op's business dealings with its own members.
Subscription of Agreement - contains Terms and Conditions which the applicant who wants to be a member must read and agree so that they can be one of the member and can be a co-owners of MSJMPC. Share Capital - represents individual member commitment to the cooperative form of business. It also identifies the individual member’s financial stake. It is withdrawn only when the member leaves the cooperative. Some other forms of member contributions, usually related to patronage, are more variable but once given cannot be withdrawn and hence are a particularly useful form of cooperative capital. Loan - the amount of loan is only depends how much did the member contribute their share capital then the loan officer will double their share capital and usually they process it one week depends on the completion of requirements. Merchandise Loan - another category of loan but in form of merchandise like rice and gift certificates from their business partners. But still they can pay the items in lump sum.
They also offer the price as much as possible lower not like in the standard market that they are only after the profit. Dental/Medical Loan - another category of loan also but in form of service thru their members that owns Dental Clinic. Savings - any time the member can put up his/her savings so that if he/she did not able to pay the loan officer can deduct the remaining balance of loan to savings. Time Deposit - is an interest-bearing bank deposit that has a specified date of maturity, with the understanding that the depositor can make a withdrawal only by giving notice. Passbook - this serves as a record of deposits and withdrawals and loans of the member and they just like in some banks they need also to present it after paying their transactions. Collection Slip - this serves as an official receipt to the members that pays their loans, savings and share capital but mostly this is applicable to the members who pay daily to the collector officer. Pre-Membership Education Seminar - it is a seminar conducted by the management of MSJMPC so that they can educate everyone who wants to be a member. To give them an idea of what is the mission, vision and goals of the organization and its by-laws.
Credit Investigation - is a process of investigating the credit status of a applicant who wants to be a member of MSJMPC Credit Committee (Cre-Com) - a Credit Committee is usually appointed by the BOD or elected by the GA. Their duties and responsibilities is to perform such credit status or the CI process and make recommendation report to the BOD for the approval of loan and to perform other functions as may prescribed in the By-Laws or Authorized by the GA. Ledger - contains summarized financial information that is classified by assignment to a specific account number using a Chart of Accounts. Journal - details all the financial transactions of a business and which accounts these transactions affect. All business transaction are initially recorded in a journal using the double-entry method or single-entry method of bookkeeping. Trial Balance - is a listing of the name and the balance of each of the accounts in the general ledger.
It is also serves as an internal report that documents which accounts have debit balances and which accounts have credit balances and proves that the total of the debit balances is equal to the total of the credit balances. Member in Good Standing (MIGS) – a member must patronize the services that the MSJMPC offers and has paid the minimum share capital required provided in the Articles of Cooperation. Also they must not be delinquent in paying of share capital contributions, loan or any accounts payable for at least a period of six (6) months to one (1) year or any period certified by the BOD By-Laws - sets of rules and regulation established and regulated by the BOD and the GA.