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How Adjustable Revolving Fund Capital Plan Works

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  • Griffin, Nelda

Abstract

Excerpts from the report Conclusion: The adjustable capital plan is being used by a few associations. It deserves consideration by other associations in a position to adopt it. One of the primary considerations appears to be a reasonably stabilized position of member capital. In addition, a slowly changing membership and a volume of business not in a declining position are significant considerations. There is no reason, however, why an association now actively increasing its member capital should not ultimately adopt the principle of revolving net balances. The procedure for installing an adjustable capital plan summarized here was worked out for the use of a particular farmer cooperative. The illustration meets the requirements for use of the adjustable capital plan in the following respects: (1) The association has reached a reasonably stable capital position, (2) the membership has changed slowly, (3) the facilities are used near their capacity, (4) the membership is small, which lessens the amount of recordkeeping, and (5) small membership makes explaining and understanding the adjustable capital plan easier.

Suggested Citation

  • Griffin, Nelda, 1963. "How Adjustable Revolving Fund Capital Plan Works," Farmer Cooperative Research Report (FCRR) 316294, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uersfc:316294
    DOI: 10.22004/ag.econ.316294
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    Keywords

    Agribusiness; Financial Economics;

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