A Report on FPO- Board of Directors (BoD’s) Training Program at Bhongiri

A Report on FPO- Board of Directors (BoD’s) Training

(16-March-2020)

Introduction:

As on date 16-March-2020 NABARD conducted a training program to the FPO BoD’s roles & responsibilities with the support of all POPI & MITHRA Foundation gave the training at S.V.Hotel at Bhonagiri, Yadadri, here some resource persons take their sessions, resource persons are NABARD DDM (Mr. Satyanarayana) ,N.Ramachandraiah, Mr. Rambabu, Mr. Swami, BoD’s training to the FPO, on this session all yadadri POPIs, BoD’s of the FPO are participated, on those MITHRA Foundation as POPI and their 4 FPO BoD’s are attend that training. This session started by NABARD DDM Satyanarayana, he gave speech related to the farmers, what type of support and schemes available for the farmers, major aim of the NABARD is to doubling the farmer income through the FPOs.

One day training session:

On this training session with starts with interdiction of the person to person, registration after that N.Ramachandraiah starts with BoD’s job roles & their responsibilities, what type of schemes are available at NABARD, Horticulture, Floriculture, Fishers, Dairy, Poultry and other LINE departments etc., a Bod’s can know each and every thing about FPO, what type activity/ Business done by that FPO on that issue they clear idea, if FPO do a Business, BoD’s decide what type business are we are doing, what type of licenses are taken from which department and also what type of books are maintained by FPO. Electronic National Agriculture Market (e-NAM), grants and equity grants support from NABARD & SFAC.

Mr. Rambabu On this session starts with what is FPO,how to increase shareholders, membership mobilization, what type problems are majorly raised on that particular area and how to overcome those things are taken placed, if FPO in down manner who will bear that loss and FPO gaining profit how to divide the shares to the members etc. and their legal compliances, book keeping process, Business plan development.

Mr. Swami was explained about marketing support and they utilization, at present marketing for their produce of the FPO, what are the local resources for the marketing like direct marketing, seed, fertilizer, pesticide business developing, food processing units, value addition to the production, crop productions, paddy, cotton and red gram their marketing, mixed vegetable, floriculture, watermelon production and marketing, how to improve our FPO activities and their marketing support.

Questionnaire was

Name: Village Name:

Mandal Name: Dist. Name: Phone No:

1. The villages where you work?

2. Main social classes in the villages where you work?

3. The crops you grow in the villages where you work?

4. The main livelihood of the people in the villages where you work?

5. Farmers use water sources in the village where you work?

6. Farmers are classified by 5 categories

a. Fine farmers : 2 ½ acres

b. Small farmers: 2 ½-5 acres

c. Lower /middles farmers: 5-7 ½ acres

d. Middle class farmers: 7 ½ -10 acres

e. Large farmers: 10 acres above

7. How much area/ space for 1 hector? In 1 Acers how many guntas?

8. How many kg’s & quintals are in 1 MT?

9. What is 1 TMC water?

10. In each year how many crops getting Minimum Support Price (MSP)?

11. On India which organization was decide the MSP for the crops?

12. In India which organization collect the crops?

13. In India which Organization collecting the commodities and oil seeds?

14. In India which one Collect the cotton?

15. On state wise which organization was collecting agricultural products?

16. State wise seeds supply Govt. institutions?

17. Abbreviation to the following PACCS, MACS, DCCB,APCOB, FPO

18. What type of loans are available in agricultural sector?

19. Who can decide the scale of finance to the agricultural sector?

20. What is scale of finance?

21. On which crop loan farmers return the amount and their interest?

22. On 2011 which GO is passed for Tenant farmers?

23. Name 3 major crop loans are gave by Govt. of Telangana?

24. What type of crop insurances are available in agricultural sector?

25. On natural disasters time what type support Govt. gave to the farmers?

26. What is WALTA act, if WALTA is implementing in your area?

27. If any benefits get from Govt. to the Suicide farmers?

What type of benefits are in FPO, farmers are getting unity to join in this type of Producer Companies, seeds, pesticides, other agricultural equipment’s getting through our FPO, the infrastructure need for agriculture like customer hiring centers, humidity equipment’s, weighting machines, godowns, clod storages, processing units. Farmers are paying crop insurance premium, if crop loss occurs farmers claiming their premium and one more thing FPO members are produce their production they can clean, grading and selling at commonly at selected place.

On this FPO-Meaning and essential features, designing of FPOs, members, BoD’s, CEO, staff of FPO their roles and responsibilities, scale and scope of FPOs, services of FPOs, typology of FPOs, key challenges of FPOs & essential factors for success of FPOs all are under the training part they discussed about what is BoD’s job role and their responsibilities on particular FPO, what type of activities they should perform and how take their FPO in sustain.

Some points regarding resource mobilization, membership, key features of membership, share capital contribution, dividend distribution, governance of FPOs- BoD’s roles & responsibilities, Board meetings, Annual general meeting, decision making, good governance practices, BoD’s job roles & responsibilities, preparation of MIS, internal check controls, requirement of financial audit, reporting, technology in managing the FPO, state and central Govt. schemes for FPOs & Agri Export policy.

Resource persons are gave their valuable information to the participants about what types of crops their produce, and their processing units ,how to prepare business plan, what type of marketing strategies related to the FPO, their turn over like these points are included, on this part they gave questionnaire related to business plan preparation and value chain process, A business plan without Governance structure and understanding the compliance requirements will only lead to future issues on sustainability of FPO as an organization. The present attempt is to provide a step by step guide to preparation of business plans by FPOs. The challenges in the FPOs regarding business plans are as under: -

Conceptualizing the business potential existing in their area of operation , Analysis of the risk involved ,Selection or scoping the business and how it can impact the FPO and its members, Understand the business they can pick up - Designing a risk mitigation plan for the business they plan to enter - Understanding fund requirement - Preparation of a financial plan with proper numbers Manpower planning, Infrastructure plan o Expenditure and income Statement, Projected Balance Sheet, Assessment of funds requirement - Tapping the funds, Rolling of business plan, Designing a benefit sharing mechanism with members and ensuring adherence to same.

Major role & responsibility of BoD’s:

1. In company minimum 5 and maximum 15 members are in director, on those elected a person as Managing Director.

2. On Common Interest Groups (CIG) 12 members are elected on those 2 members are nominated.

3. Board meeting are conducted, they intimate before 7 days of the meeting, on each Board member have their Vote.

4. Financial analysis was prepared by the BoD’s on those meetings, they take step for corporate planning preparing and monitoring that activities.

5. By the guidelines of FPO Managing Director was appointed a CEO to the FPO.

6. Annual accounting and budget preparation for the FPO.

7. Encourage members to participate in the activities of the FPO and to make use of FPO services.

8. Get approval of decisions taken by the general body meeting, and implement activities as per the decision of general body

9. To monitor and supervise the activities of the FPO

10. To appoint and supervise the activities of the CEO and other FPO employees

11. Check whether proper books of account are being maintained

12. Sanction any loan or advance, in connection with the business activities of the producer company to any member. A director cannot sanction a loan for self or directors relative.

13. Decide the dividend payable to the member

14. Decide the withheld price payable to members

15. Purchase or sales of FPO property and investment of the funds of the producer company for its business

16. Other activities to be done as per the decisions taken at the general body meetings by the members

On the part of session with major part to the FPO develop their own “Business Plan” preparation and legal compliances under the act of registration, legal compliances for business, audit/ filling returns, obtaining input / procurement licenses, permissions, legal licenses/ permits/ Documentation etc.,

Estimation of FPO Strengths:

1. Membership number (300-500)

2. Share capital amount 1000 each how many members are paid?

3. Is BoD’s of FPO is active or not?

4. Is CEO is active or not?

5. FPO office is rented or own?

6. In FPO office internet/ computer is available?

7. Water resources are available minimum (50% crop lands)

8. Variety of Crops (food crops, vegetables, fruits, commodities, millets, spices) is there?

9. Organic farming is more than 10%?

10. Opportunity for crop planning preparation and its developing?

11. Godowns / storage facilities/ cold storages available?

12. Total share capital collected by above 3lakhs

13. Availing bank loans or not

14. Processing units are there or not

15. Govt. procurement for the crops in the area

16. Govt. Market yard available(below 10 kms)

17. FPO has an own vehicle

18. Minimum 3 tons capacity of transportation vehicles are available for rent

19. FPO maintain Customer Hiring center- being machines

a. Tractor b. Harvester c. Sprayer d. None

20. 100% local marketing was available for production

21. Local merchants are there

22. Good prices are at local market for production

23. Opportunities for the retail market (1 to 100%)

24. Having a habit of saving for the members

25. FPO has out of the margin market which is essential for maintenance

26. For last 2 years onwards they have bulk order

27. Members land expansion/ crop expansion/ yield/ harvesting time schedule is available to the FPO

28. Government gave seeds on subsidy to the FPO members minimum 25% above

29. Services that are still available

a. Near to A.O/ K.V.K centers b. Support of NGO c. majority of the people have

Crop loans / crop insurances.

30. Any grants are available to the FPO

FPO Weakness:

1. BoD’s are inactive

2. Membership at low level

3. BoD’s meetings are conducted

4. Members details, crop details, market details are not available at FPO

5. Accounts are not maintained properly

6. GST, APMC, FSSAI, PGS/ICN not renewal at in time

7. Every year FPO doesn’t doing their annual reports/ audit reports/ ITRS properly

8. CEO doesn’t have a knowledge about proper book keeping for the FPO

9. They don’t have sufficient funds for doing an business for FPO

10. FPO doesn’t maintain relation with the Govt. departments of the persons

11. FPO do have a knowledge about Govt. schemes

12. CEO haven’t computer knowledge

13. Here POPI, BoD’s and CEO they don’t have coordination to an FPO

14. FPO doesn’t have sufficient infrastructure and Assets

15. They have a more credit loans on FPO

16. FPO has no marketing knowledge, value chain process of their products, e-market

FPO Scopes:

1. Consumer market is nearest to the production area

2. FPO members have an organic certificate

3. If members are more FPO doing an input marketing facilities

4. Market opportunity for a product of importance to the area

5. FPO has a scope of mortgage loans

6. FPO maintained an Bio-inputs shops

7. FPO maintained Customer Hiring center

8. FPO encourage organic farming

9. FPO do an value chain addition to their production

10. FPO established their processing units

11. After crop harvesting they crop quality maintained

12. FPO can do seed, fertilizer and pesticides business

13. Members of FPO have paid their crop insurances and if loss occur they can claim their insurances

14. FPO maintained godowns/ storage units/ clod storages/ processing units/ customer hiring centers/ weighing machines/ moisture checking machines/ tarpaulin covers

15. Members are selling their production ( cleaning, grading) at commonly

16. They discussed with the retailers/ wholesalers for the good prices

17. FPO do direct marketing by this they reduced middle man contribution

18. Through FPO their members getting Got. Schemes and their subsidies

19. FPO protect their local resources/ natural resources for farming

20. Through FPO their members are eligible to social security schemes like Pensions, Health insurance schemes, crop insurances schemes, NREGS schemes

On this part CEO major activities, proper book keeping, financial calendar preparation to their FPO, what type of license are having the FPO, what is major produce of that FPO, what are the risk factors, marketing linkages of their produce, legal compliances under the act of registration, legal compliances for business, audit and filling the returns etc., are take a place for discussion.

Meetings:

1. Meeting of BoD’s are completed before 90 days

2. After annual year compilation FPO conducted Annual General body Meeting(AGM)

3. Special audit occurs if CA/CS/FPO/POPI/RSA/NABARD

4. Annual General body Meeting and Annual Meeting they maintained gap below 15 months

5. BoD’s changes every year 1/3, they finalized at Annual General body meeting

6. Annual returns are filling before 30 days after AGM completion

7. Auditor /CS appointment is decide at AGM

8. GST filling was filled very month

9. External general body meeting was conducted if any urgency

10. All legal act registers are maintained properly

11. If meeting are not conducted time to time penalties are bear by FPO

Common books/ records to be maintain at FPO level:

Board of directors meeting minutes.
Annual General body meeting (AGM) minutes.
Cheque issue register.
Bank pass book/ Statements.
Cash books (Share Capital & Business transactions).
Ledgers for each account.
Vouchers (Receipts & Payments).
Donations/Contributions register.
Shareholders register.
Share capital collection receipts.
Assets register.
Stock register (Maintain separate data for PGS/ICS farmers).
Visitors register.
PGS/ICS farm diary’s at farmer level.
Convergence register.
Beneficiaries/Services register.
Attendance register.
Acquittance/Salaries register.
Sales/Purchase register
Stock register
Other registers need based. (Loans, Dividends, Contracts)

To be maintain files:

Audit reports.
Share certificates.
Rental Agreement.
PGS/ICS certificates.
Licenses.
Legal compliances files/Calendar
Vouchers file (Year wise)
Cooperative/FPO Bye-laws.
Cooperative/FPO Registration certificate.
Farmer wise pass books.
Cooperative/FPO operational guidelines.
Letter heads and Rubber Stamps.
Updating of Bank passbook or bank statements.
Display Name boards are maintained at inside and outside.
Point of Sale (POS)/ swiping machines and QR-codes, internet banking,

Conclusion:

On 1 days training program was very useful for the FPO members (BoD’s), how POPI & CSA, support to the FPO, how to maintain sustain FPO, how to improve share capitals, membership contribution, who will bear the loss/ profit, what type of activities are done by FPO, what type of books and meetings are maintained, main aim of the Govt. is to doubling of the income to the farmer by these FPOs.

PHOTOS