Co-operative Banking November 2019 Past Examination Question Paper – KNEC
This Past Paper examination was examined by the Kenya National Examination Council (KNEC) and it applies to the following Certificate courses
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THE KENYA NATIONAL EXAMINATIONS COUNCIL
DIPLOMA IN CO-OPERATIVE MANAGEMENT
CO-OPERATIVE BANKING
1. (a) Describe the procedure followed in recording a co-operative loan given in cash to a member. (10 marks)
(b) Outline the steps followed when carrying out monthly loan reconciliations of a co-operative society. (10 marks)
2. (a) Bero Co-operative Society wishes to carry out a technical feasibility study for the implementation of a saving scheme programme. Explain five issues that would be considered under this feasibility study. (10 marks)
(b) Highlight five non-banking financial institutions in Kenya. (10 marks)
3. (a) Explain six aims of the co-operative banking system. (12 marks)
(b) Describe four elements that constitute the gross interest. (8 marks)
4. (a) Makao Housing Co-operative Society has experienced a low rate of loan default from members for the last three years. Explain the possible measures that the society may have instituted to achieve such trend. (10 marks)
(b) The management of Bango Farmers Co-operative Society intends to take an insurance cover for its members. Explain the importance of the cover to the members. (10 marks)
5. (a) Keffa, a member of Moshi Co-operative Society, intends to borrow Ksh 1.8 million from the society to sink a borehole in his farm. He has provided the title deed to his 10 acre piece of land as security. Describe the procedure the society will take in charging the security. (12 marks)
(b) Outline four sources of funds for a co-operative society. (8 marks)
6. (a) Explain five objectives of a sound credit policy for a savings and credit co-operative society. (10 marks)
(b) Outline five conditions that must be fulfilled by a co-operative union before participating in a co-operative society scheme. (10 marks)
7. (a) Achiko is a member of Kwambata Co-operative Society. His crop value marketed through the society are as follows:
| Year | Crop value (Ksh) |
| 2015 | 280,000 |
| 2016 | 320,000 |
| 2017 | 170,000 |
(i) Calculate the upper loan limits for:
(I) short term loan
(II) medium term loan phase I and phase II. (6 marks)
(ii) Outline three reasons why Achiko should go for a short term loan. (6 marks)
(b) Highlight four distinctions between member’s savings account and member’s personal account. (8 marks)
