The Board of the Kerala State Cashew Development Corporation and Kerala State Cashew Workers Apex Industrial Co-operation Society Ltd shall be reconstituted and its Managing Director be removed from the post, recommended an expert committee formed as suggested by the High Court of Kerala.
The recommendations were made by a committee headed by P.H. Kurian, Principal Secretary, Department of Industries and Department of Information Technology.
The removal of the Managing Director and the reconstruction of the Board were needed for the revival of the Corporation. The long-term prospects of both the Corporation and the Society looked extremely grim. Both the agencies continue to incur substantial losses even though the government gave financial support to the extent of 50 to 60 per cent of the employee costs, it said.
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The panel pointed out that there was no planned procurement of raw cashew nuts and sale of products. The ad hoc way of purchase and sale had adverse impact on the financials of the organisation. There is no system of internal control, concurrent audit, cost estimation and accounting manual in the organisations, it said.
The committee also suggested that a proper concurrent audit team be appointed to monitor the purchase and sales procedures, fixations of selling prices, maintenance of proper records and to oversee that accounts are timely audited. As both the agencies have been making huge loss continually, there is the need to relook at their working model immediately. The cashew corporation is being politically construed as a labour welfare measure and not as a commercial entity. Such a thinking was probably apt in the 1970s, ’80s and ’90s as the number of workers involved was very high.