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Co-operative Societies

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A Complete Slideshow Of Co-operative Societies. :)

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Co-operative Societies

  1. 1. Nishant R. Nair <ul><li>Class - 9-2 </li></ul><ul><li>Roll No. - 28 </li></ul>
  2. 3. ‘ Co-operation’ <ul><ul><li>Derived from the Latin word ‘ co-operari ’ </li></ul></ul><ul><ul><li>‘ co ’ means ‘with’ and ‘ operari ’ means ‘to work’ </li></ul></ul><ul><ul><li>‘ Co-operation ’ means working together </li></ul></ul>
  3. 4. ‘ Co-operative Society ’ <ul><li>A voluntary association of persons; </li></ul><ul><li>working together with common economic objective ; </li></ul><ul><li>providing support to the members; </li></ul><ul><li>self-help and mutual help ; </li></ul><ul><li>non-profit motive; </li></ul><ul><li>pooling individual resources for group welfare; </li></ul><ul><li>for common benefit . </li></ul>
  4. 5. OBJECTIVES <ul><li>Render service, not for profit; </li></ul><ul><li>Mutual help, not competition; </li></ul><ul><li>Self help, not dependence; </li></ul>
  5. 6. Characteristics
  6. 7. Open membership <ul><li>Membership open to all with common interest; </li></ul><ul><li>Minimum of ten members; </li></ul><ul><li>No restriction on the maximum number; </li></ul><ul><li>Members may specify the maximum number for their Society </li></ul>
  7. 8. Voluntary Association <ul><li>Members coming together voluntarily; </li></ul><ul><li>by choice, not by force; </li></ul><ul><li>Continues for as long as he likes; </li></ul><ul><li>May leave at his will. </li></ul>
  8. 9. State control <ul><li>Registration compulsory; </li></ul><ul><li>Statutes, Rules and Bye Laws to protect the interest of members; </li></ul><ul><li>Has to maintain books and records; </li></ul><ul><li>Subject to statutory audit of books by qualified Chartered Accountants; </li></ul><ul><li>Functions under the regulatory supervision of Registrar of Co-operative Societies </li></ul>
  9. 10. Sources of Finance <ul><li>Capital contributed by all the members; </li></ul><ul><li>May raise loans and secure grants from government; </li></ul><ul><li>after its registration. </li></ul>
  10. 11. Democratic Management <ul><li>Governed by a ‘Managing Committee’ or ‘Board of Directors’ elected by the members of the society; </li></ul><ul><li>Managed on democratic lines; </li></ul><ul><li>One member one vote, irrespective of no. of shares held; </li></ul>
  11. 12. Service motive <ul><li>Co-operatives not to maximize profit but to provide service to its members; </li></ul><ul><li>A Consumer Co-operative Store sells quality goods to members at a reasonable price retaining a small margin of profit; </li></ul><ul><li>In a Housing Co-Operative, members reside by sharing expenses on maintenance and repairs. </li></ul>
  12. 13. Separate Legal Entity <ul><li>Separate legal entity; </li></ul><ul><li>Limited liability of its members; </li></ul><ul><li>Continuity of existence; </li></ul><ul><ul><li>Death, insolvency or lunacy of a member not to affect the existence of a society </li></ul></ul><ul><li>Can enter into agreements; </li></ul><ul><li>Can purchase or sell properties in its own name; </li></ul><ul><li>Can sue and be sued. </li></ul>
  13. 14. Distribution of Surplus <ul><li>Distributes Profits earned among Members on the basis of members’ participation in the business of the society; </li></ul><ul><li>Profits generated are not at the cost of its members; </li></ul><ul><li>Example: </li></ul><ul><ul><li>in a Consumer Society, profit generated by sale of goods to general public is paid as purchase bonus to members on the basis of goods purchased by them from the society. </li></ul></ul>
  14. 15. Self-help through mutual cooperation <ul><li>Co-operative Societies thrive on the principle of mutual help; </li></ul><ul><li>They are the organizations of financially weaker sections of society; </li></ul><ul><li>converts Weakness to strength by ‘self-help through mutual co-operation’; </li></ul><ul><li>Fights exploitation and secure a place in society through “Each for all and all for each”. </li></ul>
  15. 16. Formation of a Society
  16. 17. <ul><ul><li>Governed by the Co-operative Societies Act, 1912; </li></ul></ul><ul><ul><li>Minimum of 10 persons having the capacity to enter into a contract with common economic objectives; </li></ul></ul><ul><ul><li>A joint application along with the bye-laws of the society containing the details about the society and its members to the Registrar of Co-operative Societies of the concerned state; </li></ul></ul><ul><ul><li>After scrutiny, the registrar issues a Certificate of Registration </li></ul></ul>Formation of a Society
  17. 18. Requirements for Registration <ul><li>Application with the signature of all members </li></ul><ul><li>Bye-laws of the society containing: </li></ul><ul><ul><li>Name, address and aims and objectives of the society </li></ul></ul><ul><ul><li>Names, addresses and occupations of members </li></ul></ul><ul><ul><li>Mode of admitting new members </li></ul></ul><ul><ul><li>Share capital and its division </li></ul></ul>
  18. 19. Advantages
  19. 20. <ul><li>Easy Formation </li></ul><ul><li>Open Membership </li></ul><ul><li>Democratic Control </li></ul><ul><li>Limited Liability </li></ul><ul><li>Elimination of Middlemen’s . Profit </li></ul><ul><li>State Assistance </li></ul><ul><li>Stable Life </li></ul>
  20. 21. Easy Formation <ul><li>Formation easy compared to a joint stock company; </li></ul><ul><li>Any ten adults with common intent; </li></ul><ul><li>voluntarily forming an association; </li></ul><ul><li>Registered with the Registrar of Co-operative Societies. </li></ul>
  21. 22. Open Membership <ul><li>Persons with common interest </li></ul><ul><li>voluntarily coming together </li></ul><ul><li>may become a member of the society at his will </li></ul><ul><li>And leave the Society at will. </li></ul>
  22. 23. Democratic Control <ul><li>controlled in a democratic manner; </li></ul><ul><li>Elects representatives to govern the affairs of the Society; </li></ul><ul><li>One member, one vote; </li></ul><ul><li>Governing Council/ Committee accountable to members and the Regulators. </li></ul>
  23. 24. Limited Liability <ul><li>liability of members limited to the extent of the capital contributed by them to the Society; </li></ul><ul><li>No personal liability to members for the liability of the Society </li></ul>
  24. 25. Elimination of Middlemen’s Profit <ul><li>Combined strength of members; </li></ul><ul><li>to derive economies of scale; </li></ul><ul><li>for direct access to – </li></ul><ul><ul><li>manufactures and producers; </li></ul></ul><ul><ul><li>goods and services; </li></ul></ul><ul><ul><li>to markets and distribution channels ; </li></ul></ul><ul><li>Eliminates middlemen’s profit </li></ul>
  25. 26. State Assistance <ul><li>Central and State assistance; </li></ul><ul><ul><li>in the form of capital contribution; </li></ul></ul><ul><ul><li>loans at low rates of interest; </li></ul></ul><ul><ul><li>exemption in tax; </li></ul></ul><ul><ul><li>subsidies in repayment of loans, etc . </li></ul></ul>* *Graph showing Government assistance to TDCC – Tribal Development cooperation corporation
  26. 27. Stable Life <ul><li>fairly stable life; </li></ul><ul><li>continuous existence; </li></ul><ul><li>existence not affected by death, insolvency, lunacy or resignation of members. </li></ul>
  27. 28. Limitations
  28. 29. Limited Capital <ul><li>Source of capital limited, by limiting membership to a particular section of the society; </li></ul><ul><li>No incentive to members to contribute more to the capital due to low rate of return; </li></ul><ul><li>Government’s assistance often inadequate for most Co-operatives </li></ul>
  29. 30. Problems in Management <ul><li>lack of managerial talent due to – </li></ul><ul><ul><li>elected representatives lacking in managerial experience and expertise; </li></ul></ul><ul><ul><li>limited resources hampering outsourcing of professional managerial talent; </li></ul></ul>
  30. 31. Lack of Motivation <ul><li>Lack of motivation owing to – </li></ul><ul><ul><ul><li>Societies being service oriented not profit oriented; </li></ul></ul></ul><ul><ul><ul><li>Extra efforts by any particular member not getting extra reward; </li></ul></ul></ul><ul><ul><ul><li>Being aloof and not involved does not result in denial of rewards. </li></ul></ul></ul>
  31. 32. Lack of Co-operation <ul><li>Societies often suffer from – </li></ul><ul><ul><li>Personality differences; </li></ul></ul><ul><ul><li>Ego clashes; </li></ul></ul><ul><ul><li>Selfish attitudes; </li></ul></ul><ul><ul><li>Lack motivation; </li></ul></ul><ul><ul><li>Ignorance of or irreverence to principles of co-operation </li></ul></ul>
  32. 33. Dependence on Government <ul><li>Societies ften tend to be dependent on government patronage and support in terms of grants, loans subsidies, etc., owing to – </li></ul><ul><ul><li>inadequacy of capital; </li></ul></ul><ul><ul><li>Limited access to raw materials; </li></ul></ul><ul><ul><li>Lack of market and distribution of channels for products; </li></ul></ul><ul><ul><li>Vagaries of nature leading to financial burden on members, etc. </li></ul></ul>
  33. 35. Consumers’ Co-operative Society <ul><li>For protecting interest of general consumers; </li></ul><ul><li>by making consumer goods available at a reasonable price; </li></ul><ul><li>Source goods directly from the producers or manufacturers; </li></ul><ul><li>eliminates middlemen in the distribution process. </li></ul><ul><li>Some examples : </li></ul><ul><ul><li>Kendriya Bhandar, </li></ul></ul><ul><ul><li>Apna Bazar </li></ul></ul><ul><ul><li>Sahkari Bhandar </li></ul></ul><ul><ul><li>Employees consumer co-operative societies; Etc. </li></ul></ul>
  34. 36. Producers’ Co-operative Society <ul><li>to protect interest of small producers; </li></ul><ul><li>By making available raw materials, tools and equipments, machinery, etc.; </li></ul><ul><li>Arranging Marketing & Distribution channels, etc. </li></ul><ul><li>Examples: </li></ul><ul><ul><li>Amul </li></ul></ul><ul><ul><li>APPCO, </li></ul></ul><ul><ul><li>Bayanika, </li></ul></ul><ul><ul><li>Haryana Handloom, </li></ul></ul><ul><ul><li>Co-optex </li></ul></ul>
  35. 37. Co-operative Marketing Society <ul><li>Society of small producers and manufacturers; </li></ul><ul><li>collects the products from members </li></ul><ul><li>makes available better marketing & distribution channels economically; </li></ul><ul><li>sells in the market. </li></ul><ul><li>Examples: </li></ul><ul><ul><li>Anand Milk Union Ltd., (Amul); </li></ul></ul><ul><ul><li>Co-optex </li></ul></ul><ul><ul><li>UP Handloom </li></ul></ul>
  36. 38. Co-operative Credit Society <ul><li>formed to provide financial support to members </li></ul><ul><li>accepts deposits from members; </li></ul><ul><li>grants loans to members at reasonable rates of interest </li></ul><ul><ul><li>Examples: </li></ul></ul><ul><ul><ul><li>Village Service Co-operative Credit Societies, </li></ul></ul></ul><ul><ul><ul><li>Employees co-operative credit societies, etc . </li></ul></ul></ul>
  37. 39. Co-operative Banks <ul><li>formed to provide banking facilities to members; </li></ul><ul><li>accepts deposits; </li></ul><ul><li>grants loans at reasonable rates of interest </li></ul><ul><li>Examples: </li></ul>
  38. 40. Co-operative Farming Society <ul><li>formed by small farmers; </li></ul><ul><li>to pool small holdings and work to benefits of large-scale farming; </li></ul><ul><li>Examples : </li></ul><ul><ul><li>Lift-irrigation Cooperative Societies; </li></ul></ul><ul><ul><li>pani-panchayats </li></ul></ul>
  39. 41. Housing Co-operative Society <ul><li>provide residential accommodation to members </li></ul><ul><li>Constructs houses or apartments for members; </li></ul><ul><li>Provides amenities; </li></ul><ul><li>Takes care of maintenance and repairs. </li></ul>
  40. 42. IFFCO – Giant of a Co-operative
  41. 43. Co-operatives’ Share in Fertilizer Production
  42. 44. <ul><ul><ul><li>Bibliography </li></ul></ul></ul><ul><ul><ul><li>Various Internet sites </li></ul></ul></ul><ul><ul><ul><li>Acknowledgement: www.google.com </li></ul></ul></ul><ul><li>- Nishant R. Nair </li></ul>

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