Liquidating The Coop’s Cash Advances

Those of us who had been given cash advances by legal entities like the company employing us must have experienced difficulties in liquidating them. Cash advances are usually given to trusted employees and/or officers of an organization for the purpose of spending them on projects or activities requiring inputs that cannot be procured using the normal purchasing procedure. The difficulty in liquidating cash advances are caused by some expenses that may be disallowed because they are not within the reasonable expenditures tagged for the project or activity for which the money was intended to be spent. In most cases of liquidating cash advances, the trusted employee and/or officer end up returning part of the money given to him.

The start-up Pilipinas I-Café Consumer Cooperative (I-Café Coop) got stalled on its efforts to launch the business of providing more competitively-priced computer products and technologies to its member i-café owners and the public in general because of the financial mess that got revealed after the sudden departure of its two (2) top officers who left its coffers almost empty. Adding to the members’ woes was the way the resigned General Manager (GM) tried to liquidate his cash advances which were purportedly intended to cover the Cooperative Development Cost (CDC).

The remaining I-Café Coop members are questioning the GM’s receipt of PhP 20,000.00 as payment of his one-month salary but they become indignant when they saw how the GM presented the liquidation of his PhP 54,780.00 cash advances. Instead of presenting the official receipts and sales invoices for the expenses he incurred, he came out with a Statement of Account (SoC) containing the charges for the alleged services that he rendered in the development of the cooperative. The following are what the GM wants to charge the I-Café Coop according to the SoC that he submitted to the Treasurer before he irrevocably resigned:

A) Total Expenses for Registration …………………………….  PhP 40,019.56

B) Printed Materials and Web Management ……………………….. 62,000.00

C) Public Relation Fees ………………………………………………. 15,000.00

D) Two (2) Events Handled @ P20,000 each ……………………… 40,000.00

E) Representation Fees During 24 Meetings @ P1,000 ea. …….. 24,000.00

F) Total Receivable for Services Rendered to COOP ………………………………. PhP141,019.56

G) Less: Total Money Received from the Services ……………….. (54,780.00)

H) Total Amount Due for Services Rendered in Organizing the Coop …………… PhP 86,239.56

So instead of the members’ expectation that the cash advances were properly liquidated by the two (2) former top I-Café Coop officers before they resigned, they got the surprise of their lives when the former GM said in a mass email that the remaining PhP 26,170.00 in the cooperative’s fund is not even enough to pay him for the services he rendered.

As one of the remaining I-Café Coop members who shelled-out a hard-earned amount of PhP 4,000 representing my Membership Fee and initial Share Capital, I feel betrayed by the two (2) resigned I-Café Coop officers who happened to be my colleagues at I-Café Pilipinas, the non-profit, non-stock organization that started the idea of forming a cooperative for the i-café industry in the country.

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