FINANCIAL PERFORMANCE AND EFFICIENCY OF SELECTED COOPERATIVES IN MALAYSIA: RATIO AND DATA ENVELOPMENT ANALYSIS APPROACH (original) (raw)
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Examining the Efficiency of Co-operatives in Malaysia: An Application of DEA
The study examines the technical efficiency, pure technical efficiency, and scale efficiency of cooperatives in Malaysia. Data of cooperatives listed in 100 best Malaysian cooperatives from 2010 to 2017 was analyzed. To construct the efficiency model for the cooperatives , this study employed Data Envelopment Analysis (DEA). In DEA, one input (total assets) and two outputs (net income and dividend) were utilized. The results indicate that Malaysian cooperatives exhibited 62.3% overall technical efficiency during the study period where scale efficiency dominated the overall technical efficiency. Hence, we can suggest that Malaysian cooperatives had been performing better because of the scale of its operation instead of good managerial performance. The result also shows that most cooperatives were operating at non-CRS so that cooperatives need to make improvement in order to recover overall efficiency if pure technical inefficiency lead to the pure technical inefficient cooperatives could be undertaken. The result also demonstrates that scale efficiency (SE) dominated pure technical efficiency (PTE), which means that the scale and size of cooperatives are significant in raising the level of scale efficiency. The management of cooperatives in Malaysia should enhance their managerial performance because the PTE was found to contribute less to overall technical efficiency (OTE).
Examining the Efficiency of Co-operatives in Malaysia: An Application of Data Envelopment Research
2019
The study examines the technical efficiency, pure technical efficiency, and scale efficiency ofco-operatives in Malaysia. Data ofco-operatives listed in 100 best Malaysian co-operatives from 2010 to 2017wasanalyzed. To construct the efficiency model forthe co-operatives, this studyemployed Data Envelopment Analysis (DEA). In DEA,one input (total assets) and two outputs (net income and dividend)were utilized. The results indicate that Malaysian co-operatives exhibited 62.3% overall technical efficiency during the study period where scale efficiency dominated the overall technical efficiency. Hence, we can suggest that Malaysian co-operatives had been performing better because of the scale of its operation instead of good managerial performance.The result also shows that most co-operatives were operating at non-CRS so that co-operatives need to make improvement in order to recover overall efficiency if pure technical inefficiency lead to the pure technical inefficient co-operatives co...
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This paper aims to introduce an alternative way to benchmark the efficiency of 30 Indonesian cooperatives at the provincial level from 2000 to 2007. A balanced panel data was used to determine the total factor productivity (TFP) and identify the main drivers to technical efficiency. A stochastic frontier analysis (SFA) was used to determine the influence of environmental variable such locations to technical efficiency of the cooperatives. Furthermore, based on this specification the efficiency frontiers are computed using data envelopment analysis (DEA). The efficiency of each cooperative was then ranked and compared to check for consistency. The study found that on average, cooperatives are 19.4 percent away from the production frontier. The panel data allows for the calculation of productivity change based on Malmquist index. Results found that on average, TFP increased by 8 percent during the observation periods which driven much by 13.6 percent increased in innovation.
Measuring The Efficiency of Pesantren Cooperatives: Evidence in Indonesia
Global Review of Islamic Economics and Business, 2018
The Cooperative (Koperasi) as a non-Bank financial institution has the purpose of improving the welfare of its members as Koperasi Hidmat and the staffs of Latifah Mubarokiyah Koperasi Ponses Suryalaya that have been since decades ago. Over time, the ideal cooperative can show a significant development and increase the welfare of its members. This study aims to determine the efficiency of cooperative as a benchmark, because by known the performance value of a cooperation, it will known the weeknesses and advantages so that it can be improved the weaknesses and maintain the advantages.The method used is apply Data Envelopment Analysis (DEA). Inputs used from principal savings, mandatory savings, and fixed assets while the output used from savings in the cooperative, savings in other cooperative and SHU. As for result of this research indicates there are 9 perfect efficient DMUs (100 %) and inefficient DMU is 11 DMUs, consisting of 7 (IRS conditions) and 4 (DRS condition). The mos...
The Efficiency of Pesantren Cooperative using Data Envelopment Analysis (DEA): A Case in Indonesia
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The purpose of this research is to analyze the level of efficiency of Islamic boarding schools cooperatives as well as potential improvements needed, and to compare the efficiency of Islamic boarding schools cooperatives. In addition, this research also looks at the efficiency of Islamic boarding school cooperatives during the Covid-19 pandemic. The research period used in this research is from 2014-2021 with a research sample of 2 Islamic boarding schools cooperatives. The analytical method used is a non-parametric approach, namely Data Envelopment Analysis (DEA), with secondary data sources originating from the financial reports of Islamic boarding schools cooperatives as the research sample. Furthermore, the input variables used are fixed assets, mandatory savings and principal savings. The output variable consists of SHU and deposits in other bodies. The results of this study indicate that the efficiency of Islamic boarding school cooperatives during the 2014-2021 period has flu...
Measuring the efficiency of Pesantren cooperatives, Evidence in Indonesia.pdf
Global Review of Islamic Economics and Business, 2018
The Cooperative (Koperasi) as a non-Bank financial institution has the purpose of improving the welfare of its members as Koperasi Hidmat and the staffs of Latifah Mubarokiyah Koperasi Ponses Suryalaya that have been since decades ago. Over time, the ideal cooperative can show a significant development and increase the welfare of its members. This study aims to determine the efficiency of cooperative as a benchmark, because by known the performance value of a cooperation, it will known the weeknesses and advantages so that it can be improved the weaknesses and maintain the advantages.The method used is apply Data Envelopment Analysis (DEA). Inputs used from principal savings, mandatory savings, and fixed assets while the output used from savings in the cooperative, savings in other cooperative and SHU. As for result of this research indicates there are 9 perfect efficient DMUs (100 %) and inefficient DMU is 11 DMUs, consisting of 7 (IRS conditions) and 4 (DRS condition). The most inefficient cooperative is Koperasi Hidmat (2014) of 30.66% efficiency level.Kopkar IAILM is able to maintain its grade efficiency level from 2009 to 2015 when compared to other DMUs cooperatives in the observation, except in 2014. The calculation of efficiency level in this research is relative and it is not absolute, so that it is possible when the cooperative sample is added or the observation year is expanded, so it will get different result. The necessity of any cooperative or BMT based on Pondok Pesantren to make annual financial statements in order to increase accountability and transparency of fund management.
Business Performance of Cooperatives in Malaysia: Issues, Challenges and Future Direction
Journal of Technical and Vocational Education (JTVE), 2020
The performance of business in cooperatives sector should be grown rapidly every year. It is in line with the goals of its establishment which aims to mobilize the resources of the members for their economic and welfare benefits. Nevertheless, the cooperatives' membership which has recorded rapid growth each year does not support the significant increase of some of its key economic performance indicators. In this regard, this study aims to examine the development of cooperatives business in Malaysia in order to know the current position of its performance. In addition, the study also want to examine several issues arising from the performance of the cooperatives business and the challenges they faced. The data and figures discussed are derived from secondary sources especially from SKM and ICA, as well as references from previous studies. Some suggestions are also discussed for future directions.
Efficiency and Profitability Analysis of Agricultural Cooperatives in Mpumalanga, South Africa
Journal of Economics and Behavioral Studies
Agricultural cooperatives are expected to generate sustainable profit as they are established as a vehicle of economic development. Efficiency and profitability analysis measures the performance of a firm, and assists management in decision-making through benchmarking with other firms (Marwa & Aziakpono, 2014). To understand the performance of agricultural cooperatives, our study analysed efficiency and profitability using an efficiency-profitability matrix to provide for multi-dimensional analysis. The study used secondary data from annual financial statements for the financial years 2015/16 collected from 19 agricultural cooperatives. Technical efficiency was estimated using Data Envelopment Analysis (DEA) and profitability was estimated using Returns on Assets (ROA). The median scores were 68% for technical efficiency and 10% for profitability. Using the 68% efficiency and 10% profitability benchmark, the matrix separated best performers from low performers. The matrix indicated ...
Annals of Public and Cooperative Economics, 2008
The study of the performance of agricultural cooperatives has become increasingly important in recent years, due to the significant role that they have in the agricultural food sector. In this context, the present study has a double aim: On one hand to use the Data Envelopment Analysis (DEA) technique in order to measure the efficiency of agricultural cooperatives, and on the other hand, to analyse if this technique is complementary to the traditional economic and financial ratio analysis. In order to achieve these objectives, an empirical study is carried out using the data of 247 observations made over a horizontal time span of three accounting years (2001)(2002)(2003). The results show that the efficiency measures obtained by means of the DEA technique are an appropriate complement to the economic analysis of agricultural cooperatives.
The Philippines is an agricultural country and the dairy farming is one of the industries which provide vigor to the economy. The Federation of Davao Dairy Farmers Cooperatives (FEDDAFC) is one of the producers of fresh cow's milk in the Philippines and the only one in Davao City. All the eight dairy cooperatives under the FEDDAFC were considered. This study aims to measure the technical efficiency of the primary cooperatives under FEDDAFC; identify which among the cooperatives is/are the most technically efficient and inefficient; examine the potential of milk production if dairy farms could operate efficiently; and provide recommendations to improve the production of every cooperative. The technical efficiency was measured through the outputoriented model using Data Envelopment Analysis Program (DEAP) to obtain the most efficient cooperative using the inputs, namely grass, cow, farmer, and water, and output (milk) in terms of liters. Results show that the mean values of technical efficiencies under Constant Returns to Scale (CRS) and Variable Returns to Scale (VRS) which are 0.693 and 0.855, respectively. Calinan Dairy Farmers Cooperative (CDFC) is the most efficient with CRS and VRS of 1 because of the efficient allocation of inputs. It is followed by Malagos Dairy Cooperative (MDC), Aklat Dairy Cooperative (ADC) and Riverside Dairy Farmers Cooperative (RIDAFCO). Wangan Dairy Farmers Cooperative (WADAC), Cadalian Dairy Farmers Cooperative (CADAFCO), Biao Joaquin Dairy Farmers Cooperative (BJDAFCO) and Tacunan Dairy Farmers Cooperative (TADAFCO) are the inefficient cooperatives. Therefore, it implies that these inefficient cooperatives can further increase their outputs by undertaking their opportunities and proper usage of their resources by allocating their inputs proportionally. Results show that WADAC should mimic the practices of CDFC and ADC; BJDAFCO and TADAFCO should follow CDFC, ADC, and RIDAFCO; and CADAFCO should also follow CDFC, MDC and RIDAFCO to operate efficiently within the FEDDAFC. Given that these inefficient cooperatives will implement these changes, their outputs will increase from 11 to 37 percent.