1. Presented to Member Training Session 20 th October 2012

2. THE BUDGET The budget constitutes a plan of activities to which values in a currency are allocated based on a specific period.(i.e month, year or number of years) The budget offers an organization a better means of planning, provides greater control over its activities and hence the future. The budget makes the organization more accountable to its members and is viewed as a motivational tool encouraging continued financial growth through results.

3. DEVELOPING THE BUDGET The development of the budget involves gathering information from various sources both internally and externally. All information is then presented to the budget committee in form of a budget proposal from the SACCO management. The Committee reviews the budget proposal in line with the strategic plan to enable the SACCO achieve its medium term and long term goals.

4. BUDGET ACTIVITIES The budget of the SACCO comprises operational, administrative and development activities. The major business of the SACCO is saving and lending to members. The bulk of funds is allocated to mobilization of savings, encouraging the purchase of shares by members and the access to various loan products. The administrative activities include the meeting costs, staff salaries, communication costs, local/ international travel, member training, rent and audit fees.

5. BUDGET ACTIVITIES(Cont’d) The development activities include acquisition office equipment, acquisition of business software, purchase of vehicles and acquisition of office premises. The budget also provides for investment of funds as a risk management measure. The excess funds can be invested in treasury bills, government bonds and deposit funds which bear high interest per annum. All budget estimates are based on a one year period derived from the Calendar year i.e January-December

6. BUDGET ANALYSIS The Budget Committee reviews the budget proposals in comparison with the previous year’s budget and financial performance. A review of all budget items is done and where important items have been left out, the budget committee requests management to include them. On completion of the review, the Budget committee presents the budget proposals to the Board/Executive Committee for consideration and approval.

7. BUDGET APPROVAL The budget proposals are reviewed by the Board/Executive Committee and then approved with or without changes. The Supervisory Team reviews the budget and give its opinion before and during the AGM. A final copy of the budget is printed in preparation for the Annual General Meeting.(AGM) During the AGM, the Treasurer presents the Budget to the members for endorsement. Once endorsed, the Budget is signed by Chairperson, Treasurer and General Secretary.

8. BUDGET IMPLEMENTATION The budget is then distributed to the various Board Sub-committees and SACCO management for implementation. The Sub-committees set various targets to enable the budget to be realised and ensure that adequate controls are put in place to avoid wastage of resources. Members are encouraged to participate in all important activities planned for the year and are equally encouraged to give feedback to management. Budget performance constitutes more than 70% of Board’s targets.

9. END Thank you!