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Annual Report 2002

Contents

Auditors' Report

Pannell Kerr Forster
Chartered Accountants


Worldwide
Pannell House
P.O. Box 1798
Grand Anse
St. George's
Grenada, West Indies
Telephone: (473) 440-2562/3014
Fax: (473) 440-6750
E-mail: pkf@caribsurf.com


Report of the Auditors to the Members of
The Communal Co-operative Credit Union Limited

We have audited the accompanying Balance Sheet at 31st December, 2002 and the related statements of Income and Expenditure and Cash Flows for the year then ended. These Financial Statements are the responsibility of the Credit Union's Management. Our responsibility is to express an opinion on these Financial Statements based on our audit.

Except as reported below, we conducted our audit in accordance with approved accounting Standards. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the Financial Statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the Financial Statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall Financial Statement presentation. We believe that our audit provides a reasonable basis for our opinion.

We report as follows:

    • The Credit Union accounts for interest on loans on a cash receipt basis. This is not in accordance with International Accounting Standards.

In our opinion, except for any adjustments which may be necessary due to the above matter, the Financial Statements referred to above, as set out on pages 23 to 30 present fairly in all material respects, the financial position of the Credit Union at 31st December, 2002 and the results of its operations for the year then ended in conformity with approved accounting standards.

Notes to the Financial Statements At 31st December, 2002

8. Accounts Receivable and Prepayments1. Registration and Principal Activity
The Credit Union was registered on 19th October, 1965 under the Co-operative Societies Ordinance as amended by the Co-operative Act No. 20 of 1996 for the purpose of affording members of the Credit Union the opportunity to accumulate savings and to obtain credit for provident or productive purposes at reasonable rates of interest.

2. Accounting Principles

    • (a) Basis of Accounting

These financial statements have been prepared under the historical cost convention and in accordance with generally accepted accounting principles.

    • (b) Fixed Assets and Depreciation

Fixed assets are stated at historical cost. Depreciation has been provided on all fixed assets at rates estimated to be sufficient to write off the cost of these assets over the period of their estimated useful lives.

3. Loans
2002
EC$
2001
EC$
Total Loans
13,973,707
11,834,347
Less: Provision for loan losses
239,794
208,893
13,733,913
 11,625,454

These loans are secured by mortgages, bills of sale and personal guarantees. Interest is payable at rates of between 9% and 14% per annum.

4. Short Term Investments
2002
EC$
2001
EC$
British American Insurance Company Limited
600,000
-
Bank of Nova Scotia - Term Deposit
-
580,089
National Commercial Bank of Grenada Limited
400,000
-
- Excel account
2,270,639
954,789
Grenada Co-operative Bank Limited
300,000
-
Fincor - Fixed deposits
-
618,259
3,570,639 2,153,137

5. Investments - Other

2002
EC$
2001
EC$
12,899 ordinary shares in the
64,495
64,495
Grenada Co-operative League Limited

7. Due from League

2002
EC$
2001
EC$
Deposit Account
106,455
103,354

The Communal Co-operative Credit Union Limited is a member of the Grenada Co-operative League Limited.

8. Accounts Receivable and Prepayments
2002
EC$
2001
EC$
Payroll deductions
36,294
34,318
Government of Grenada - Tax overpaid
-
213
Insurance prepayment
1,881
1,744
Jersey debtors
765
1,259
Other prepayments
650
2,330
Interest on investment
49,377
51,670
88,967
91,534

9. Cash and Bank Balances

2002
EC$
2001
EC$
Cash on hand
13,050
12,950
National Commercial Bank of Grenada Limited
    • Current account
303,001
312,061
    • "Montserrat" savings account
5,683
5,479
321,734
330,490
10. Long Term Loan

Balance at
31/12/02		 Instalments due
in one year		 Long term
Balance
First Caribbean International Bank
(Barbados) Limited
892,623
61,460
831,163

The loan is secured by a mortgage over property at H.A. Blaize Street/Green Street and is being repaid over a period of fifteen (15) years by monthly instalments of $15,664.00 to include both principal and interest.

11. Shares
These shares are of a nominal value of $5.00 when fully paid up.

12. Statutory Reserve

2002
EC$
2001
EC$
Balance at 1st January, 2002
654,393
573,517
Entrance fees
881
598

Transfer from operations
86,536
80,278
Balance at 31st December, 2002 741,810
654,393

In accordance with Section 119(2) of the Co-operative Societies Act No. 20 of 1996, at least twenty percent (20%) of the surplus for the year shall be transfered to the Reserve Fund. The transfer during the year has been made in accordance therewith.

13. Micro Capital Grant
This amount represents the first tranche under an agreement between the Organisation of Eastern Caribbean States Secretariat, the United Nations Development Programme and the Credit Union. The total amount committed is $562,035.

14. Income Tax
The Credit Union is exempt from the payment of Income Tax under Section 25(P) of the Income Tax Act 1994.