Publication: Foreign exchange earnings performance of coffee industry in Rwanda: a case study of Maraba Coffee Cooperative
Total Views 11
total viewsTotal Downloads 20
total downloadsDate
2014
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Mount Kenya University
Cite this Item
Abstract
The profitability of any cooperative depends on the investment in foreign exchange earnings of its
product that allows the maximization of profitability and increase financial performance (Word
Bank, 2003). The general objectives of this study was therefore to analyze foreign exchange
earnings and financial performance of coffee industry in Rwanda, to analyze and interpret financial
statement and daily financial events of Maraba coffee cooperative to ascertain financial
performance and whether the relationship between foreign exchange earnings and financial
performance. This study will contribute to the Government’s orientation, small famers of coffee,
Coffee Cooperatives, coffee exporters and Rwandan economy in general. The study used a case
study research design whereby Quantitative method refers to the mathematical and statistical
interpretation of the result. On the other hand qualitative research method as the subjective one
explained the inner thoughts and emotions of the respondent. This study was conducted in Huye
District and the targeted populations for this study precisely were 8 board members, 4 staffs and
1872 cooperative farmers‟ members. The data collected using documentation, questionnaire and
interview instruments. The researcher used the financial analysis and the statistical analysis with
the help of the software Statistical Package for the Social Sciences (SPSS) for data presentation
and interpretation. The findings of the study revealed that the increase of foreign earnings was
followed by the increased expenses. From 2009 to 2010 foreign earnings increase of 6% but the
expenses increased of 12%, whereas from 2010 up to 2011, foreign earnings increase of 99.87%
while the expenses increased of 103.99% and from 2011 up to 2012, foreign earnings decreased
of 2.27% but the expenses decreased of 0.46%. Maraba coffee cooperative had not perform
financially due to the increased expenses and increased liabilities, particularly in 2010 and 2012
than 2009 and 2011. The uses of financial information analysis, daily financial events was not full
considered in such as efficient management of foreign earnings; the Cooperative had not made
proper financial decision in order to improve its financial performance during this period of four
years. Therefore, there is no relationship between foreign exchange earnings and financial
performance, the increased of foreign exchange earnings are followed by increased expenses and
the increase of total assets also followed by increased liabilities as presented in table 4.14 and 4.15.
As the cooperative indicates poor financial performance, it should improve the system of analysis
and interpretation of the information from the income statements, to increase foreign earnings and
minimize expenses; convert cooperative’s equity into profit to perform better financially.
Description
Keywords
Cooperative societies