EXECUTIVE SUMMARY

Internship is a period of time during which a student gets practical experience in a job. The two months’ internship was carried out at Victoria Customs Cooperative Credit Union (VCCCUL) Head Office Bota Limbe.

My aim of this internship was to blend theory with accounting practice. I carried out several activities at the accounting department such as updating individual ledgers, preparing financial statements and income statements.

However, my focus area was on loan delinquency because the rate of delinquent loans at VCCCUL was a call for concern. I examine the various loan types that VCCCUL grants to its member the principles governing lending such as the loan policy, loan that mostly goes delinquent, defaulted loans and the reasons behind them.

The union also has a weakness in that, most often they do not well assess their customer before granting loans, granting loans based on trust or confidence of the customer history since he/she has never defaulted payment.

To conclude, VCCCUL is recommended to strictly follow its loan policy to avoid or minimize loan delinquency.

CHAPTER ONE

GENERAL INTRODUCTION

1.1 INTRODUCTION

An internship is defined by the 8th edition of the Oxford Advanced Learners Dictionary (OALD) as a period of time during which a student or new graduate gets practical experience in a job.

During this time, mostly towards the end of the school year, students are opportune through the school administration to experience  real life working  environment .It is a very important tool to professionalism because it builds your mind socially and psychologically to face the challenges of the changing world.

The internship was carried out for a period of about two months from 9th January to 13th February 2012 at Victoria Customs Cooperative Credit Union Limited in Limbe. Many things were learned physically from the activities carried out by the Organization some of which include filling of loan forms and creating of accounts to customers.

1.2 AIMS AND OBJECTIVES OF THE STUDY

The practical experiences of working environment are important for professional’s development. The aims and objectives of the study are:

• To apply the knowledge and skills obtained from theory practically
• For the partial Fulfillment of Higher National Diploma (HND) preparation
• To learn the ethics of Accounting profession
• To motivate a personal carrier interest serving as a bridge between the school and the world of work
• To expose, encourage and build a mind of working experiences and knowledge that is required in industries.

1.3 OPERATIONAL DEFINITIONS OF TERMS

LOANS

A loan is a contractual agreement between a lender and a borrower on an amount loaned at a specific interest rate at a specific duration.

LOAN DELINQUENCY

Loan delinquency is a failure to make loan repayment on time.

RECOVERY COMMITTEE

This is a group of persons that are in charge of loan recovery. They informed borrowers of loan repayment.

COLLATERAL

Collateral is any valuable asset that a borrower promised to the lender as a guarantee for a loan repayment. It is preferable to accept collaterals that can be easily converted to cash. A legal document to show that the asset belongs to the customer in question and the collateral value to cost the amount obtained. The most acceptable collateral in VCCCUL is land.

CHAPTER TWO

PRESENTATION OF THE ORGANISATION

2.1 LOCATION

Victoria Customs Cooperative credit Union Limited is a micro finance institution located in the south West Region of Cameroon. It is found precisely at Bota Government Residential Area (GRA) nearthe Cameroon Development Cooperation (CDC) head office which is the credit union head office.

2.2 HISTORICAL BACKGROUND OF THE ORGANISATION

Born in 1979, Victoria Customs Cooperative Credit Union Limited (VCCCUL) was formed by some custom officers in the English speaking Cameroon. Though originally meant for Custom workers with time has extended its membership to non-custom workers. It is operating in its own premises with well allocated space for member services and has numerous branch offices scattered throughout the nation like New Town Limbe behind Police Barracks, Mile 4 Limbe, and Douala-Bonaberi and in Yaoundé-Essos. Through education and efficient management, it is witnessing tremendous growth in membership, share/savings. The head office has about three thousand, seven hundred and sixty members (3760). It is affiliated to Cameroon Cooperative Credit Union League Limited (CamCCUL). Registered and recognized by COBAC to carry out category one activities.

2.3 AIMS /OBJECTIVES OF VCCCUL

VCCCUL like other financial cooperatives has a mission which include;

They provide services to improve the economic and social wellbeing of their members as well as practice the value of equity and mutual self-help.

They also provide quality and rapid financial services and product;

• Encourage regular savings, wise lending as well as prompt payment by members.
• With efficient and competent board of directors and staff, they are out to provide quality product and service to their members.
• The union is out to pay a fair rate of interest to members on their savings.
• The members are provided with efficient and quality education that will enable the union to compete favorably with other financial institution.