JPS & Partners - Financial Statements 31st December2018 (4.4.19)

JPS & PARTNERS CO-OPERATIVE CREDIT UNION LIMITED
NOTES TO THE FINANCIAL STATEMENTS - CONT'D
FOR THE YEAR ENDED 31ST DECEMBER 2018
(Expressed in Jamaican Dollars unless otherwise indicated)
Page 20
3. Statement of Compliance, Basis of Preparation and Significant Accounting Policies (cont'd):
(m) Members' Shares
Permanent Shares
Permanent Shares may be transferred by members to another member but are not available for withdrawal.
Permanent shares are classified as equity.
Voluntary Shares
Members voluntary shares represent deposit holdings of the Credit Union's members, to satisfy membership
requirements and to facilitate eligibility for loans and other benefits. These shares are classified as financial
liabilities. Returns to members on these shares are determined at the discretion of the Credit Union, are denoted as
interest and are reported as expense in the income statement in the period in which approved.
(n) Foreign Currency Transactions -
Functional and presentation currency
Items included in the financial statements are measured using the currency of the primary economic environment in
which the Credit Union operates. The Credit Union's primary economic environment is Jamaica, and as such, its
functional and presentation currency is Jamaican dollars.
Transactions and balances
Foreign currencies at the date of the statement of financial position are stated at the rates of exchange ruling on that
date. Transactions in foreign currencies are converted at the rates of exchange ruling at the date of those
transactions. Gains and losses arising from fluctuations in exchange rates are included in the statement of
comprehensive income.
(o) Statutory Reserve -
The Co-operative Societies Act provides that at least twenty percent (20%) of the annual net income
honoraria should be carried to a Statutory Reserve Fund.
(p) League Fees and Stabilisation Dues -
before
Jamaica Co-operative Credit Union League Limited (JCCUL) has fixed the rate of league fees at 0.2% (2017 -
0.25%) of total assets. Stabilisation dues are fixed at a rate of 0.15% (2017 - 0.15%) of total savings.
The Credit Union is required by the JCCUL to maintain its institutional capital at a minimum of eight percent (8%) of
total assets. At the date of the statement of financial position, the ratio of institutional and permanent share capital to
total assets was 18.16% (2017: 17.78%) which is in compliance with the requirements.
(q) Interest Income and Expense
Interest income and expense are recognised in the statement of comprehensive income for all interest-bearing
instruments on an accrual basis, using the effective yield method, based on the actual purchase price. Interest
income includes coupons earned on fixed income investments and accrued discounts or premiums on discounted
instruments.
Where collection of interest is considered doubtful, the related financial instruments are written down to their
recoverable amounts and interest income is therefore recognised based on the rate of interest that was used to
discount the future cash flows for the purpose of measuring the recoverable amount.
(r) Fees and Commission Income
Fees and commission income are recognised on an accrual basis.