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BasicCooperativeEducationSeminar      MARICEL G. RUEDAS, CDS II      CDA Dagupan Extension Office                         ...
“ A cooperative is an :         autonomous         duly registered association of persons         with common bond of i...
3
• cooperatives are  voluntary organizations• open to all persons• able to use their services• willing to accept the respon...
democraticCooperatives are :• democratic organizations.• controlled by their members• directors or officers are accountabl...
• members contribute  equitably to the capital of  their cooperative. They  shall receive limited  compensation or limited...
• cooperatives are  autonomous,• self-help organizations    & independence  controlled by their  members.• ensure democrat...
cooperatives shall provideeducation and training for theirmembers, elected and appointedrepresentatives, managers, andempl...
Cooperatives serve theircooperat ioncooperat ion                 members most effectively               and strengthen the...
cooperatives workfor the sustainabledevelopment oftheir communitiesthrough policiesapproved by theirmembers.              ...
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(a)Credit Cooperative(b) Consumers Cooperative;(c) Producers(d) Marketing Cooperative(e) Service Cooperative(f) Multi-purp...
(i) Cooperative Bank(j) Dairy Cooperative(k) Education Cooperative(l) Electric Cooperative(m) Financial Service Cooperativ...
(p) Housing Cooperative(r) Transport Cooperative(s) Water Service Cooperative(t) Workers Cooperative(u) Other types of coo...
15
(1)To encourage thrift and savings   mobilization among the members;(2) To generate funds and extend   credit to the membe...
(3) To encourage among members    systematic  production and    marketing;(4) To provide goods and services    and other r...
(6) To acquire lands and provide    housing   benefits  for  the    members;(7) To insure against losses of the    members...
(9) To establish, own, lease or    operate cooperative banks,    cooperative wholesale and retail    complexes, insurance ...
(11) To advocate for the cause of the     cooperative movement;(12) To ensure the viability of     cooperatives through th...
(13) To encourage and promote self-     help or self-employment as an     engine for economic growth and     poverty allev...
22
This should be enumeratedspecifically by the cooperative intheir articles of cooperation thetype of business that they wil...
24
(1) To the exclusive use of its    registered name, to sue and be    sued;(2) Of succession;(3) To amend its articles of  ...
(4) To adopt by-laws not contrary to    law, morals or public policy, and    to amend and repeal the same in    accordance...
(5) To purchase, receive, take or grant,    hold, convey, sell, lease, pledge,    mortgage, and otherwise deal with    suc...
(6) To enter into division, merger or    consolidation(7) To form subsidiary cooperatives(8) To join federations or unions...
(9) To avail of loans, be entitled to    credit and to accept and    receive grants, donations and    assistance from fore...
(10) To avail of preferential rights    granted to cooperatives under    Republic    Act   No.     7160,    otherwise know...
(11) To organize and operate schools     in accordance with Republic Act     No. 9155(12) To exercise such other powers   ...
ORGANIZING A PRIMARY   COOPERATIVE                       32
ORGANIZING A PRIMARYCOOPERATIVEThe following may organize a primarycooperative   • Fifteen (15) or more natural persons wh...
ECONOMIC SURVEY    Every group of individuals or cooperativesintending to form a cooperative under this Codeshall submit t...
TERM   A cooperative shall exist for a period notexceeding fifty (50) years from the date ofregistration unless sooner dis...
ARTICLES OF COOPERATION        All cooperatives applying for registration shallfile with the Authority the Articles of Coo...
REGISTRATION      A cooperative formed or organized under thisCode acquires juridical personality from the datethe Authori...
AMENDMENT OF ARTICLES OFCOOPERATION AND BY-LAWS      Unless otherwise prescribed by this Codeand for legitimate purpose, a...
MEMBERSHIP             39
KINDS OF MEMBERSHIPREGULAR MEMBERS       A regular member is one who has complied with allthe membership requirements and ...
GOVERNMENT OFFICERS ANDEMPLOYEES•Any officer or employee of the Authority shall bedisqualified to be elected or appointed ...
APPLICATION FOR MEMBERSHIP      An applicant for membership shall bedeemed a member after approval of hismembership by the...
LIABILITY OF MEMBERS      A member shall be liable for the debts of thecooperative to the extent of his contribution to th...
TERMINATION OF MEMBERSHIP• A member of a cooperative may, for any validreason, withdraw his membership from thecooperative...
REFUND OF INTERESTS      All sums in accordance with the by-laws to bedue from a cooperative to a former member shallbe pa...
46
Organizational Structure                                     General Assembly                                          Boa...
ADMINISTRATION                 48
COMPOSITION OF THE GENERALASSEMBLY        The General Assembly shall be composed of such members who are entitled to vote ...
POWERS OF THE GENERALASSEMBLY The General Assembly shall be the highest policy- making body of the cooperative. The genera...
MEETINGS    A regular meeting shall be held by the generalassembly on a date fixed in the by-laws, or if not sofixed, on a...
QUORUMA quorum shall consist of at least twenty-fivepercent (25%) of all the members entitled to vote.VOTING SYSTEMEach me...
COMPOSITION AND TERM OF THEBOARD OF DIRECTORS       The direction and management of the affairsof a cooperative shall be v...
POWERS OF THE BOARD OFDIRECTORSThe board of directors shall be responsible for thestrategic planning, direction-setting an...
DIRECTORSAny member of a cooperative , who has the right tovote and possess all the qualifications provided inthe by-laws ...
MEETING OF THE BOARD ANDQUORUM REQUIREMENTS   Regular meetings of the board of directors shall beheld at least once a mont...
VACANCY IN THE BOARD OFDIRECTORS      Any vacancy in the board of directors, otherthan expiration of term, may be filled b...
OFFICERS OF THE COOPERATIVE   The board of directors shall elect from amongthemselves the chairperson and vice-chairperson...
DEGREE OF RELATIONSHIPThe prohibition on relationship by consanguinityand affinity within the third civil degree applieswi...
DEGREE OF RELATIONSHIPI. RELATIONSHIP BY CONSANGUINITY    1. First Degree    Parent to Child    2. Second Degree   Grandpa...
DEGREE OF RELATIONSHIPII.         RELATIONSHIP BY AFFINITY1. First Degree    Parent-in-law to Daughter –in –law2. Second D...
OFFICERS OF THE COOPERATIVEThe officers of the cooperative shall include:• Members of the board of directors• Members of t...
COMMITTEES OF COOPERATIVES   The By-laws shall provide for the creation of the  following committees:1. Audit committee   ...
FUNCTIONS, RESPONSIBILITIESAND TRAINING REQUIREMENTS OFDIRECTORS, OFFICERS ANDCOMMITTEE MEMBERS    The functions and respo...
COMPENSATION    In the absence of any provision in the by-lawsfixing their compensation, the directors shall notreceive an...
REMOVAL OF ELECTED OFFICERS   All complaints for the removal of any elected officershall be filed with the board of direct...
RESPONSIBILITIES, RIGHTS   AND PRIVILEGES OF     COOPERATIVES                           67
ADDRESS   Every cooperative shall have an official postaladdress to which all notices and communicationsshall be sent. Suc...
BOOKS TO BE KEPT OPENEvery cooperative shall have the followingdocuments ready and accessible to its membersand representa...
REGISTER OF MEMBERS AS PRIMAFACIE EVIDENCEAny register or list of members or shares kept by anyregistered cooperative shal...
BONDING OF ACCOUNTABLEOFFICERS   Every director, officer and employee handlingfunds, securities or property on behalf of a...
TAX TREATMENT OFCOOPERATIVES    Duly registered cooperatives under this Codewhich do not transact any business with non-me...
CAPITAL, PROPERTY AND        FUNDS                        73
CAPITAL      The capitalization of cooperative and the   accounting procedures shall be governed by   the provisions of th...
SHARE CAPITAL    The term ‘share’ refers to a unit in a primarycooperative the par value of which may be fixed at anyfigur...
CAPITAL SOURCES Cooperative registered under this Code may derive their capital from any or all of the following sources:1...
LIMITATION ON SHARE CAPITALHOLDINGS    No member of a primary cooperative other than a cooperative itself shall own or hol...
ASSIGNMENT OF SHARE CAPITALCONTRIBUTION OR INTEREST No member shall transfer his shares or interest in the cooperative or ...
CAPITAL BUILD-UP        The by-laws of every cooperative shall    provide for a reasonable and realistic    member capital...
ALLOCATION ANDDISTRIBUTION OF NET      SURPLUS                      80
NET SURPLUS     Every cooperative shall determine its net  surplus at the close of every fiscal year.     The net surplus ...
DISTRIBUTION OF NET SURPLUSThe net surplus of every cooperative shall bedistributed as follows:1. Reserve Fund –at least 1...
DISTRIBUTION OF NET SURPLUS4. Optional Fund (Land and Building)- shall not   exceed 7% of the net surplus.5. The remaining...
REPORTS REQUIRED FOR    COOPERATIVE                       84
REQUIRED REGULAR REPORTS  The following reports shall be submitted to theAuthority:1. Cooperative Annual Performance Repor...
FILING     All registered cooperatives shall file with the Authority a copy of the required reports either through persona...
REQUIRED REGULAR REPORTS  The following reports shall be submitted to theAuthority:1. Cooperative Annual Performance Repor...
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   They follow all business norms like:       Compliance with all business requirements        such as but not limited t...
   They follow all business norms like:       Selling at market price       Avoid destructive competition among        ...
   Constant expansion   Quality Standardized Goods   Minimize Expenditures   Comply with basic requirements of    a bu...
   Constant expansion   Quality Standardized Goods   Minimize Expenditures   Comply with basic requirements of    a bu...
1. BIR REGISTRATION Articles of Cooperation and By-laws Certificate of Registration from CDA2. Tax Identification Number...
3. Book of Accounts   - yearly, on or before the last     working day of December   - 2 Columnar, Cash Receipt,    Cash Di...
4. Certificate of Tax Exemption   * Certified true copy of Articles of      Cooperation, By-laws and      Certificate of R...
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Basic Cooperative Education Seminar

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Cooperative Development Authority
Dagupan Extension Office
Region I
Philippines

Published in: Business

Basic Cooperative Education Seminar

  1. 1. BasicCooperativeEducationSeminar MARICEL G. RUEDAS, CDS II CDA Dagupan Extension Office 1
  2. 2. “ A cooperative is an :  autonomous  duly registered association of persons  with common bond of interest  who have voluntarily joined together to achieve  their social, economic, and cultural needs and  aspirations  making equitable distributions to the capital  required  patronizing their products and services and  accepting a fair share of the risks and benefits of  the undertaking in accordance with universally  accepted cooperatives principles.” 2
  3. 3. 3
  4. 4. • cooperatives are voluntary organizations• open to all persons• able to use their services• willing to accept the responsibilities of membership 4
  5. 5. democraticCooperatives are :• democratic organizations.• controlled by their members• directors or officers are accountable to the membership.• members have equal voting rights 5
  6. 6. • members contribute equitably to the capital of their cooperative. They shall receive limited compensation or limited interest, if any, on capital subscribed and paid up as a condition of membership. 6
  7. 7. • cooperatives are autonomous,• self-help organizations & independence controlled by their members.• ensure democratic control of their members• Maintain their cooperative autonomy 7
  8. 8. cooperatives shall provideeducation and training for theirmembers, elected and appointedrepresentatives, managers, andemployees. 8
  9. 9. Cooperatives serve theircooperat ioncooperat ion members most effectively and strengthen the cooperative movement by working together through local, national, regional and international structures. 9
  10. 10. cooperatives workfor the sustainabledevelopment oftheir communitiesthrough policiesapproved by theirmembers. 10
  11. 11. 11
  12. 12. (a)Credit Cooperative(b) Consumers Cooperative;(c) Producers(d) Marketing Cooperative(e) Service Cooperative(f) Multi-purpose Cooperative;(h) Agrarian Reform Cooperative 12
  13. 13. (i) Cooperative Bank(j) Dairy Cooperative(k) Education Cooperative(l) Electric Cooperative(m) Financial Service Cooperative(n) Fishermen Cooperative(o) Health Services Cooperative 13
  14. 14. (p) Housing Cooperative(r) Transport Cooperative(s) Water Service Cooperative(t) Workers Cooperative(u) Other types of cooperatives as maybe determined by the Authority 14
  15. 15. 15
  16. 16. (1)To encourage thrift and savings mobilization among the members;(2) To generate funds and extend credit to the members for productive and provident purposes; 16
  17. 17. (3) To encourage among members systematic production and marketing;(4) To provide goods and services and other requirements to the members;(5) To develop expertise and skills among its members; 17
  18. 18. (6) To acquire lands and provide housing benefits for the members;(7) To insure against losses of the members;(8) To promote and advance the economic, social and educational status of the members; 18
  19. 19. (9) To establish, own, lease or operate cooperative banks, cooperative wholesale and retail complexes, insurance and agricultural/industrial processing enterprises, and public markets;(10) To coordinate and facilitate the activities of cooperatives; 19
  20. 20. (11) To advocate for the cause of the cooperative movement;(12) To ensure the viability of cooperatives through the utilization of new technologies; 20
  21. 21. (13) To encourage and promote self- help or self-employment as an engine for economic growth and poverty alleviation; and(14) To undertake any and all other activities for the effective and efficient implementation of the provisions of this Code. 21
  22. 22. 22
  23. 23. This should be enumeratedspecifically by the cooperative intheir articles of cooperation thetype of business that they willengage into. 23
  24. 24. 24
  25. 25. (1) To the exclusive use of its registered name, to sue and be sued;(2) Of succession;(3) To amend its articles of cooperation in accordance with the provisions of this Code; 25
  26. 26. (4) To adopt by-laws not contrary to law, morals or public policy, and to amend and repeal the same in accordance with the Code; 26
  27. 27. (5) To purchase, receive, take or grant, hold, convey, sell, lease, pledge, mortgage, and otherwise deal with such real and personal property as the transaction of the lawful affairs of the cooperative may reasonably and necessarily require, subject to the limitations prescribed by law and the Constitution; 27
  28. 28. (6) To enter into division, merger or consolidation(7) To form subsidiary cooperatives(8) To join federations or unions 28
  29. 29. (9) To avail of loans, be entitled to credit and to accept and receive grants, donations and assistance from foreign and domestic sources. 29
  30. 30. (10) To avail of preferential rights granted to cooperatives under Republic Act No. 7160, otherwise known as the Local Government Code, and other laws. 30
  31. 31. (11) To organize and operate schools in accordance with Republic Act No. 9155(12) To exercise such other powers granted by the Code or as stated in its articles of cooperation. 31
  32. 32. ORGANIZING A PRIMARY COOPERATIVE 32
  33. 33. ORGANIZING A PRIMARYCOOPERATIVEThe following may organize a primarycooperative • Fifteen (15) or more natural persons who are Filipino citizens • Of legal age (18 years old) • Having common bond of interest • Residing or working in the intended area of operation • Have completed a Pre-Membership Education Seminar (PMES) 33
  34. 34. ECONOMIC SURVEY Every group of individuals or cooperativesintending to form a cooperative under this Codeshall submit to the Authority a general statementdescribing, among others the structure andpurposes of the proposed cooperative. Provided, That the structure and actual staffingpattern of the cooperative shall include abookkeeper. 34
  35. 35. TERM A cooperative shall exist for a period notexceeding fifty (50) years from the date ofregistration unless sooner dissolved or unlesssaid period is extended. 35
  36. 36. ARTICLES OF COOPERATION All cooperatives applying for registration shallfile with the Authority the Articles of Cooperationwhich shall be signed by each of the organizersand acknowledged by them before a notary public.BY-LAWS Each cooperative to be registered under thisCode shall adopt by-laws not inconsistent with theprovisions of this Code. 36
  37. 37. REGISTRATION A cooperative formed or organized under thisCode acquires juridical personality from the datethe Authority issues a certificate of registrationunder its official seal.CERTIFICATE OF REGISTRATION A certificate of registration issued by theAuthority under its official seal shall be conclusiveevidence that the cooperative therein is dulyregistered unless it is proved that the registrationthereof has been cancelled. 37
  38. 38. AMENDMENT OF ARTICLES OFCOOPERATION AND BY-LAWS Unless otherwise prescribed by this Codeand for legitimate purpose, any provision or matterstated in the articled of cooperation and by-lawsmay be amended by two-thirds (2/3) vote of all themembers with voting rights. 38
  39. 39. MEMBERSHIP 39
  40. 40. KINDS OF MEMBERSHIPREGULAR MEMBERS A regular member is one who has complied with allthe membership requirements and entitled to all the rightsand privileges of membership.ASSOCIATE MEMBERS An associate member is one who has no right tovote nor be voted upon. Provided, that an associatemember who meets the minimum requirements of regularmembership, continues to patronize the cooperative fortwo (2) years, and signifies his/her intention to remain amember shall be considered a regular member. 40
  41. 41. GOVERNMENT OFFICERS ANDEMPLOYEES•Any officer or employee of the Authority shall bedisqualified to be elected or appointed to any position ina cooperative.•All elective officials of the Government shall beineligible to become officers and directors ofcooperatives.•Any government employees or official may, in thedischarge of his duties as member in the cooperative,be allowed by the head of office concerned to useofficial time for attendance at the general assembly,board and committee meetings of cooperatives as wellas cooperative seminars, workshops, technicalmeetings and training courses locally or abroad. 41
  42. 42. APPLICATION FOR MEMBERSHIP An applicant for membership shall bedeemed a member after approval of hismembership by the Board of Directors and shallexercise the rights of member after having madesuch payments to the cooperative. In case membership is refused or denied bythe board of directors, an appeal may be made tothe general assembly and the latter’s decision shallbe final. 42
  43. 43. LIABILITY OF MEMBERS A member shall be liable for the debts of thecooperative to the extent of his contribution to theshare capital of the cooperative. 43
  44. 44. TERMINATION OF MEMBERSHIP• A member of a cooperative may, for any validreason, withdraw his membership from thecooperative by giving a sixty (60) day notice to theboard of directors.•The death or insanity of a member in a primarycooperative•Membership in the cooperative may be terminatedby a vote of the majority of all the members of theboard of directors: •do not patronized any of the services of the cooperative •Continuously failed to comply with his obligations, i.e. delinquency in loans 44
  45. 45. REFUND OF INTERESTS All sums in accordance with the by-laws to bedue from a cooperative to a former member shallbe paid to him either by the cooperative or by theapproved trasferee, as the case may be, inaccordance with this Code. 45
  46. 46. 46
  47. 47. Organizational Structure General Assembly Board of Election Audit Committee Directors Committee Mediation/ Ethics Other Conciliation Committee Secretary Treasurer Committee Committees Management Staff
  48. 48. ADMINISTRATION 48
  49. 49. COMPOSITION OF THE GENERALASSEMBLY The General Assembly shall be composed of such members who are entitled to vote under the Articles of cooperation and By-laws of the cooperative. 49
  50. 50. POWERS OF THE GENERALASSEMBLY The General Assembly shall be the highest policy- making body of the cooperative. The general assembly shall have the following powers: •To determine and approve amendments to the articles of cooperation and by-laws •To elect or appoint the members of the board of directors, and to remove them for cause. •To approve developmental plans of the cooperative 50
  51. 51. MEETINGS A regular meeting shall be held by the generalassembly on a date fixed in the by-laws, or if not sofixed, on any date within ninety (90) days after theclose of each fiscal year. Provided, that notice ofregular meetings shall be sent in writing, by posting orpublication, or through other electronic means to allmembers of record. Whenever necessary, a special meeting of thegeneral assembly may be called at any time by amajority of the board of directors or as provided for inthe by-laws. 51
  52. 52. QUORUMA quorum shall consist of at least twenty-fivepercent (25%) of all the members entitled to vote.VOTING SYSTEMEach member of a primary cooperative shall haveonly one (1) vote. (one man-one vote policy) 52
  53. 53. COMPOSITION AND TERM OF THEBOARD OF DIRECTORS The direction and management of the affairsof a cooperative shall be vested in a board ofdirectors which shall be composed of not less thanfive (5) nor more than fifteen (15) memberselected by the general assembly for a term fixed inthe by-laws but not exceeding a term of two (2)years and shall hold office until their succesors areduly elected and qualified, or until duly removed forcause. 53
  54. 54. POWERS OF THE BOARD OFDIRECTORSThe board of directors shall be responsible for thestrategic planning, direction-setting and policy-formulation of the cooperatives. 54
  55. 55. DIRECTORSAny member of a cooperative , who has the right tovote and possess all the qualifications provided inthe by-laws shall be eligible for election as director.The members of the board of directors shall nothold any other position directly involved in the dayto day operation and management of thecooperative.Any person engaged in a business similar to that ofthe cooperative or who in any way has a conflict ofinterest with it, is disqualified from election as adirector of said cooperative. 55
  56. 56. MEETING OF THE BOARD ANDQUORUM REQUIREMENTS Regular meetings of the board of directors shall beheld at least once a month. Special meetings of the board of directors may beheld at any time upon the call of the chairperson or amajority of the members of the board. A majority of the members of the board shallconstitute a quorum for the conduct of business. Directors cannot attend or vote by proxy at boardmeetings. 56
  57. 57. VACANCY IN THE BOARD OFDIRECTORS Any vacancy in the board of directors, otherthan expiration of term, may be filled by the vote ofat least a majority of the remaining directors. Otherwise, the vacancy must be filled by thegeneral assembly in a regular or special meetingcalled for the purpose. A director so elected to fill a vacancy shallserve only the unexpired term of his predecessor inoffice. 57
  58. 58. OFFICERS OF THE COOPERATIVE The board of directors shall elect from amongthemselves the chairperson and vice-chairpersonand elect or appoint other offices of the cooperativefrom outside of the board. No two (2) or more persons with relationships upto the third degree of consanguinity or affinity norshall any person engaged in business similar tothat of the cooperative shall serve as an appointiveoffice. 58
  59. 59. DEGREE OF RELATIONSHIPThe prohibition on relationship by consanguinityand affinity within the third civil degree applieswithin each category since the Code says no two ormore persons within the third civil degree ofconsanguinity or affinity shall serve as elective orappointive officers in the same board. For purposes of clarity hereunder are thedegree of relationships covered under the saidprohibition. 59
  60. 60. DEGREE OF RELATIONSHIPI. RELATIONSHIP BY CONSANGUINITY 1. First Degree Parent to Child 2. Second Degree Grandparent to Child Brother to Sister 3. Third Degree Uncle to Child Aunt to Child Greatgrandparent to Child 60
  61. 61. DEGREE OF RELATIONSHIPII. RELATIONSHIP BY AFFINITY1. First Degree Parent-in-law to Daughter –in –law2. Second Degree Brother –in-law to sister-in-law3. Third degree Greatgrandparent-in-law to Daughter/Son-in-law to Uncle/Aunt-in-law to Niece/Nephew-in-law 61
  62. 62. OFFICERS OF THE COOPERATIVEThe officers of the cooperative shall include:• Members of the board of directors• Members of the different committees created by the general assembly• General manager• Secretary• Treasurer• Other positions as maybe provided for in the by-laws 62
  63. 63. COMMITTEES OF COOPERATIVES The By-laws shall provide for the creation of the following committees:1. Audit committee - elected by GA2. Election committee - elected by GA3. Mediation and Conciliation committee - appointed4. Ethics committee - appointed by BOD5. Education committee - appointed by BOD6. Other committees as may be necessary for the conduct of the affairs of the cooperative (ex. Credit committee) 63
  64. 64. FUNCTIONS, RESPONSIBILITIESAND TRAINING REQUIREMENTS OFDIRECTORS, OFFICERS ANDCOMMITTEE MEMBERS The functions and responsibilities of thedirectors, officers and committee members, as wellas their training requirements, shall be inaccordance with the rules and regulations issuedby the Authority. 64
  65. 65. COMPENSATION In the absence of any provision in the by-lawsfixing their compensation, the directors shall notreceive any compensation except for reasonableper diems. 65
  66. 66. REMOVAL OF ELECTED OFFICERS All complaints for the removal of any elected officershall be filed with the board of directors. Such officer shall be given the opportunity to beheard. Upon finding of a prima facie evidence of guilt,the board shall present its recommendation forremoval to the general assembly. An elective officer may be removed by ¾ votes ofthe regular members present and constituting aquorum, in a regular or special general assemblymeeting called for the purpose. 66
  67. 67. RESPONSIBILITIES, RIGHTS AND PRIVILEGES OF COOPERATIVES 67
  68. 68. ADDRESS Every cooperative shall have an official postaladdress to which all notices and communicationsshall be sent. Such address and every changethereof shall be registered with the Authority. 68
  69. 69. BOOKS TO BE KEPT OPENEvery cooperative shall have the followingdocuments ready and accessible to its membersand representative of the Authority for inspection:1. A copy of this Code and all other laws pertaining to cooperatives;2. A copy of the regulations of the Authority3. A copy of the articles of cooperation and by-laws of the cooperative4. The books of the minutes of the meetings of the General Assembly, board of directors and committess5. Share books6. Financial Statements 69
  70. 70. REGISTER OF MEMBERS AS PRIMAFACIE EVIDENCEAny register or list of members or shares kept by anyregistered cooperative shall be prima facie evidence ofthe following particulars enetered therein:1. The date on which the name of any person was entered in such register or list as member2. The date on which any such person ceased to be a member. 70
  71. 71. BONDING OF ACCOUNTABLEOFFICERS Every director, officer and employee handlingfunds, securities or property on behalf of anycooperative shall be covered by a surety bond to beissued by a duly registered insurance or bongdingcompany for the faithful performance of their dutiesand obligations. Upon filing the application for registration of acooperative, the bonds of the accountable officersshall be required by the Authority. 71
  72. 72. TAX TREATMENT OFCOOPERATIVES Duly registered cooperatives under this Codewhich do not transact any business with non-members or the general public shall not be subjectto any taxes and fees imposed under the internalrevenue laws and other tax laws. 72
  73. 73. CAPITAL, PROPERTY AND FUNDS 73
  74. 74. CAPITAL The capitalization of cooperative and the accounting procedures shall be governed by the provisions of this Code and the regulations which shall be issued. 74
  75. 75. SHARE CAPITAL The term ‘share’ refers to a unit in a primarycooperative the par value of which may be fixed at anyfigure not more than 1000 pesos. The share capital of the cooperative is the moneypaid or required to be paid for the operations of thecooperative. The share capital consist of:• Common share capital-issued to regular members• Preferred share capital-issued to associate members 75
  76. 76. CAPITAL SOURCES Cooperative registered under this Code may derive their capital from any or all of the following sources:1. Members’ share capital2. Loans and borrowings including deposits3. Revolving capital which consists of the deferred payment of patronage refunds or interest on share capital4. Subsidies, donations, legacies, grants, aids and such other assistance from any local or foreign institution whether public or private. 76
  77. 77. LIMITATION ON SHARE CAPITALHOLDINGS No member of a primary cooperative other than a cooperative itself shall own or hold more than ten percent (10%) of the subscribed share capital of the cooperative. 77
  78. 78. ASSIGNMENT OF SHARE CAPITALCONTRIBUTION OR INTEREST No member shall transfer his shares or interest in the cooperative or any part thereof unless: • He has held such share capital contibution or interest for not less than 1 year • The assignment is made to the cooperative or to a member of the cooperative • The board of directors shall approve such assignment. 78
  79. 79. CAPITAL BUILD-UP The by-laws of every cooperative shall provide for a reasonable and realistic member capital build-up program to allow for continuing growth of the members’investment in their cooperative as their own economic conditions continue to improve. 79
  80. 80. ALLOCATION ANDDISTRIBUTION OF NET SURPLUS 80
  81. 81. NET SURPLUS Every cooperative shall determine its net surplus at the close of every fiscal year. The net surplus shall not be construed as profit but an excess of payments made by the members for the loans borrowed or goods and services availed by them and which shall be deemed to have been returned to them if the same is distributed as prescribed herein. 81
  82. 82. DISTRIBUTION OF NET SURPLUSThe net surplus of every cooperative shall bedistributed as follows:1. Reserve Fund –at least 10% of net surplus. Provided, That, in the first 5 years of operation after registration, this amount shall not be less than 50% of the net surplus.2. Education and Training Fund-shall not be more than 10% of the net surplus.3. Community Development Fund-shall not be less than 3% of the net surplus. 82
  83. 83. DISTRIBUTION OF NET SURPLUS4. Optional Fund (Land and Building)- shall not exceed 7% of the net surplus.5. The remaining net surplus shall be made available to the members in the form of • Interest on share capital • Patronage refund 83
  84. 84. REPORTS REQUIRED FOR COOPERATIVE 84
  85. 85. REQUIRED REGULAR REPORTS The following reports shall be submitted to theAuthority:1. Cooperative Annual Performance Report (CAPR)2. Audited Financial Statement duly stamped “Received”by BIR3. Socio Audit Report4. Performance Report5. List of Officers and Trainings undertaken/completed 85
  86. 86. FILING All registered cooperatives shall file with the Authority a copy of the required reports either through personal, registered mail, courier or electronic means, within 120 days from the end of every calendar year. 86
  87. 87. REQUIRED REGULAR REPORTS The following reports shall be submitted to theAuthority:1. Cooperative Annual Performance Report (CAPR)2. Audited Financial Statement duly stamped “Received”by BIR3. Socio Audit Report4. Performance Report5. List of Officers and Trainings undertaken/completed 87
  88. 88. 88
  89. 89. 89
  90. 90.  They follow all business norms like:  Compliance with all business requirements such as but not limited to business permits; registration with BIR; social legislation and labor laws;  Adherence to local laws;  Healthy competition;  Open trade;  Cash trading 90
  91. 91.  They follow all business norms like:  Selling at market price  Avoid destructive competition among coops  Adequate capitalization  Adherence to business governance 91
  92. 92.  Constant expansion Quality Standardized Goods Minimize Expenditures Comply with basic requirements of a business enterprise. 92
  93. 93.  Constant expansion Quality Standardized Goods Minimize Expenditures Comply with basic requirements of a business enterprise. 93
  94. 94. 1. BIR REGISTRATION Articles of Cooperation and By-laws Certificate of Registration from CDA2. Tax Identification Number (TIN) 94
  95. 95. 3. Book of Accounts - yearly, on or before the last working day of December - 2 Columnar, Cash Receipt, Cash Disbursement, Ledger,Journal 95
  96. 96. 4. Certificate of Tax Exemption * Certified true copy of Articles of Cooperation, By-laws and Certificate of Registration * Application Letter * BIR Registration * TIN of member or cedula 96
  97. 97. 97

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