Module3-Coop-1.pdf

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Cooperative Management (eFM-CM/eHRM-CM)
MODULE 3
INTRODUCTION TO COOPERATIVE MANAGEMENT
INTRODUCTION
This module introduces you to the basic concepts and principles of cooperative
management, the requirements in registering a cooperative, the organizational structures
of cooperative and the different types of cooperative. This consists of three lessons.
Lesson 1 explains the basic concepts and principles of cooperative management. Lesson
2 discusses the organizational structure of a cooperative and its functions. And lesson 3
focuses on the different types of cooperatives and elaborates on the categories of
cooperatives and its basic registration fees.
LESSON 1
BASIC CONCEPTS OF COOPERATIVE CORPORATION
I – Learning Objectives
After studying this lesson, you should be able to:
1. acquire the basic knowledge on the concepts, principles of cooperative
management and specific guidelines on how to register a cooperative; and
2. identify the role of Cooperative Development Authority (CDA) in cooperative
movement.
II - Discussion
WHAT IS COOPERATIVE?
A cooperative is an autonomous and duly registered association of persons, with
a common bond of interest, who have voluntarily joined together to achieve their social,
economic, and cultural needs and aspirations by making equitable contributions 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 cooperative
principles (Article 3, RA 9520).
The International Cooperative Alliance (ICA) defines cooperative as follows:
“A cooperative is an autonomous association of persons united voluntarily to meet
their common economic, social, and cultural needs and aspirations through a joint-owned
and democratically - controlled enterprise.”
The following are the characteristics of cooperative emphasized in the definition of
cooperative by ICA:
1. The cooperative is autonomous. It means the cooperative is as independent
of government and private firms as possible.
2. It is an “association of persons”. This means that cooperatives are free to
define “persons” in any legal way they choose. Many primary societies around
the world choose only to admit individual human beings. Many other primary
cooperatives admit “legal persons”, which in many jurisdictions include
companies, extending to them the same rights as any other member.
3. The persons are united “voluntarily”. Membership in a cooperative should not
be compulsory. Members should be free, within the purposes and resources of
the cooperative, to join or to leave.
4. Members of cooperative “ meet their common economic, social and cultural
needs”. This definition of cooperative emphasizes that cooperatives are

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organized by their members and for their members. Whatever the needs of the
members, they may be economic, social or cultural, they are the central
purpose for which the cooperative exists.
5. The cooperative is a “jointly-owned and democratically controlled
enterprise’. This emphasizes that ownership is distributed among members on
a democratic basis. Each cooperative is also an “enterprise” in the sense that
it is an organized entity, normally functioning in the market place; it must strive
to serve its members efficiently and effectively.
COOPERATIVE PRINCIPLES (Source: Article 4, RA 9520)
Every cooperative shall conduct its affairs in accordance with Filipino culture, good
values and experience and the universally accepted principles of cooperation which
include, but are not limited to, the following:
(1) Voluntary and Open Membership - Cooperatives are voluntary
organizations, open to all persons able to use their services and willing to accept the
responsibilities of membership, without gender, social, racial, cultural, political or religious
discrimination.
(2) Democratic Member Control - Cooperatives are democratic organizations
that are controlled by their members who actively participate in setting their policies and
making decisions. Men and women serving as elected representatives, directors or
officers are accountable to the membership. In primary cooperatives, members have
equal voting rights of one-member, one-vote. Cooperatives at other levels are organized
in the same democratic manner.
(3) Member Economic Participation - Members contribute equitably to, and
democratically control, the capital of their cooperatives. At least part of that capital is the
common property of the cooperative. They shall receive limited compensation or limited
interest, if any, on capital subscribed and paid as a condition of membership. Members
allocate surpluses for any or all of the following purposes: developing the cooperative by
setting up reserves, part of which should at least be indivisible; benefitting members in
proportion to their patronage of the cooperative's business; and, supporting other
activities approved by the membership.
(4) Autonomy and Independence - Cooperatives are autonomous, self-help
organizations controlled by their members. If they enter into agreements with other
organizations, including government, or raise capital from external sources, they shall do
so on terms that ensure democratic control of their members and maintain their
cooperative autonomy.
(5) Education, Training and Information - Cooperatives shall provide education
and training for their members, elected and appointed representatives, managers, and
employees, so that they can contribute effectively and efficiently to the development of
their cooperatives.
(6) Cooperation Among Cooperatives - Cooperatives serve their members most
effectively and strengthen the cooperative movement by working together through local,
national, regional and international structures.
(7) Concern for Community - Cooperatives work for the sustainable
development of their communities through policies approved by their members.
CONCEPTS & PRINCIPLES OF COOPERATIVE MANAGEMENT
In a cooperative organization a general body is formed with the help of voluntarily
united persons to meet their common interest after properly utilizing the resources. The

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universal definition of management is equally applicable to the cooperative management.
The survival and growth of a cooperative organization depends largely on the
competence and character of its management. Cooperative management is the dynamic
life giving element in every cooperative organization. Sound cooperative management
provides the following benefits:
(i) To achieve group goals,
(ii) To utilize resources,
(iii) To fulfill social obligations,
(iv) To maintain economic growth,
(v) To ensure the survival of a cooperative society in a fast changing
environment,
(vi) To improve the personality and caliber of people to raise their efficiency and
productivity,
(vii) To meet the challenge of change.
A cooperative organization has to combine judiciously the principles of
management with the principles of cooperation. Cooperative management signifies the
application of management principles to the cooperatives. With regard to the cooperative
principles George Devidoric writes, “they are a set of rules which govern the life and
activity of cooperative organization.” Mr. Herrick in Rural credit expressed more tersely
cooperation is to the act of persons, voluntarily united, of utilizing reciprocally their own
forces, resources, or both under the mutual management to their common profit or loss.
Another writer says that “the principle of cooperation lies on voluntary association
of individuals, combined to achieve an improvement in social and economic conditions
through the common ownership and democratic management of the instrument of
wealth.” These principles are characteristic features which distinguish cooperation from
other forms of organization. These are commonly described as the principles of co-
operation.
Originally, the Rochdale Society of Equitable pioneers propounded the principles
of cooperation although prior to these pioneers Robert Owen, Charles Fourier and William
King visualized an ideal form of society based on co-operation and mutual help. Though
to meet the requirement of the dynamic social and economic stage the original principles
had undergone certain changes, yet the theme of these principles remains unfiltered and
still provide the spirit of the countless persons concerned.
The Rochdale society indicated the following principles:
[a] Open membership.
[b] Democratic control.
[c] Limited interest on capital.
[d] Patronage dividend.
[e] Cash trading.
[f] Purity and quality of product.
[g] Education of members.
h] Political and religious neutrality.
i] Sale at market price and voluntary membership.
There are other principles, apart from the above applied to all types of cooperatives
which have been applied to the Agricultural credit societies in particular. These principles
are popularly known as Raiffeissen principles. Such principles are: Self help, (2) Limited
area, (3) Allocation of entire surplus to indivisible reserve, (4) Membership without
subscription of shares, (5) Unlimited liability of members, (6) Limitation of business to
members only , (7) Voluntary work by board members.

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REQUIREMENTS FOR REGISTERING A COOPERATIVE
Once you have organized your cooperative, your work does not end there. The
cooperative now needs a legal personality. It can do all acts that a cooperative is
supposed to perform. With a legal personality, the cooperative starts operating funds from
membership fees common or preferred stocks, bonds by borrowing from banks or from
other sources. If the cooperative has legality to operate, selling goods and services,
deliver goods and enter into all sorts of business transactions. Cooperative can do all
enumerated activities if it has been registered to the Cooperative Development Authority
(CDA).
WHERE DO YOU REGISTER YOUR COOPERATIVE?
The Cooperative Development Authority (CDA) is the only government agency
mandated to register all types of Cooperatives. Its main office is located at 827 Aurora
Boulevard, Service Road, Barangay Immaculate Concepcion, Quezon City.
There are satellite offices installed to facilitate the flow of CDA'S services from
Region 1 to Region 13a:
a. Dagupan City
b. Tuguegarao
c. Baguio City
d. San Pedro, Pampanga
e. NCR-Quezon City
f. Calamba, Laguna
g. Naga City
h. Ilollo City
i. Cebu City
j. Tacloban City
k. Zamboanga City
l. Cagayan De Oro City
m. Davao City
n. Kidapawan City
o. Butuan City
p. Cotabato City
WHAT ARE THE GENERAL REQUIREMENTS FOR REGISTERING A
COOPERATIVE? Source: (CDA 2019) Cooperative Development Authority RA 9520
Organizing a cooperative can be complex and simple. It requires an understanding
of the basic needs of the prospective cooperative members. It demands patience from
the organizer who must make the cooperative's long-term goals and objectives, and its
visions a real part of the members existence.
NINE (9) STEPS SUGGESTED IN SETTING UP A COOPERATIVE
1. GET ORGANIZED. You must have at least 15 members to do that. At once,
determine the common problems you would want to solve and the basic needs you would
want to provide through the cooperative. You may want to include increasing your
production, where to market your produced goods, credit assistance, power generation,
banking or insurance and other similar needs. Determining your problems and needs will
also help you classify the kind of cooperative you will be organizing. Even before a
cooperative set-up, a dedicated core group people who will do all the organizational and
paper works is a must. From this core group, working communities may be formed to set

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things in order. These committees may include membership, finance, executive,
secretariat and etc.
2. RESERVED YOUR PROPOSED COOPERATIVE NAME. Secure and fill up
Cooperative Name Reservation Request Form (CNRRF). This must be submitted to CDA
Central Office or any of its Extension Satellite Office. A reservation fee shall apply.
3. PREPARE A GENERAL STATEMENT CALLED AN ECONOMIC SURVEY.
Economic Survey is a general statement describing, among others, the structure and
purposes of the proposed cooperative. The structure and actual staffing pattern shall
include a bookkeeper. This should indicate the area of operation, the size of membership
and other pertinent data in a format provided by the Authority.
4. PREPARE THE COOPERATIVE'S BY-LAWS. The by-laws contain the rules
and regulation governing the operation of the cooperative.
5. PREPARE THE ARTICLES OF COOPERATION. Mandatory contents of the
articles of cooperation are the following
a.) the name of the cooperative, which must include the word "cooperative",
b.) the purpose or purposes and scope of business for which the cooperative is to
be registered;
c.) the term of existence of cooperative
d.) the area of operation and the postal address of its principal office,
e.) the names, nationality and the postal addresses of the registrants
f.) the common bond of membership;
g.) the list of names of the directors who shall manage the cooperative; and
h.) the amount of its share capital, the names and residences of its contributors,
and a statement of whether the cooperative is primary, secondary or tertiary. The
articles of cooperation shall be signed by each of the organizers and
acknowledged by them if natural persons, and by the chairperson or secretaries,
if juridical persons, before a notary public.
i.) Arbitral Clause
6. SECURE BOND OF ACCOUNTABLE OFFICER(S). A surety bond should be
secured from a duly registered insurance or bonding company. Every director, officer and
employee handling funds, securities or property on behalf of the cooperative shall be
covered by this. The board of directors shall determine the adequacy of such bonds.
7. EXECUTE TREASURERSS AFFIDAVIT. A sworn statement of the treasurer
elected by the subscribers showing that at least twenty-five per centum (25%) or he
authorized share capital has been subscribed, and at least twenty-five per centum (25%)
of the total subscription has been paid should be executed and to be attached to the
articles of cooperation. The paid-up share capital shall not be less that Fifteen thousand
pesos (P15,000.00).
8. COMPLETE THE PRE-MEMBERSHIP EDUCATION SEMINAR (PMES). A
prospective member of a primary cooperative must have completed a Pre-Membership
Education Seminar (PMES). A Certificate of PMES must be secured from the training
provider.

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9. REGISTER YOUR COOPERATIVE WITH THE COOPERATIVE
DEVELOPMENT AUTHORITY (CDA). Submit the following required documents in four
(4) copies:
Articles of Cooperation and By-Laws duly notarized;
1. Economic Survey;
2. Articles of Cooperation and By-Laws,
3. Surety bond of accountable officers;
4. Treasurer's Affidavit;
5. Approved Cooperative Name Reservation Slip;
6. Certificate of PMES
The Cooperative Development Authority (CDA) is the sole government agency
mandated to register all types of cooperatives, its main office is located at 827 Aurora
Blvd., Immaculate Conception, Quezon City. Prospective cooperatives must submit their
application to the CDA Extension/satellite Offices where the principal office of the
cooperative is located.
The following are the amount of fees to be paid for the registration of cooperatives per
CDA per Memorandum Circular 2004-07, Series of 2004:
The initial registration fee to be imposed shall be 1/10 of 1% of the authorized share
capital or the basic fee below whichever. Four copies of Economic Survey, By-Laws and
Articles of Cooperation.
The article of Cooperative should be duly notarized and accompanied by the following:
a. Bonds of the accountable officers (any director, officer and employee) handling
funds, securities or properties on behalf of the cooperative.
The board of directors determine the amount of bonds required based on the
initial net worth which shall include the paid- up capital, membership tees and
other assets of the cooperative at the time of registration; and
b. Sworn statement of the treasurer duly notarized showing that at least 25% of
the authorized share capital has been subscribed, and at least 25% of the total
subscription has been paid.
The paid-up capital must not be less than PhP 2,000.00. It must be noted that
no member may own more than 20% of the subscribed share capital and each
share must not be less than PhP1.00.

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Name: ______________________________ Program & Year level: ______________
Course & Year: _______________________ Date: ____________________________
Exercise 1.1
SHARE YOUR THOUGHTS
Directions: Answer the following questions in your own words using the space provided.
1. Give the importance of studying cooperative management. (5 pts.)
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2. Give the nine (9) steps in setting up a cooperative. (5points)
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3. Why do we need to register our cooperative? (5points)
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4. What is the role of cooperative development authority? (5points)
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LESSON 2
ORGANIZATIONAL STRUCTURE OF COOPERATIVE MANAGEMENT
1. demonstrate understanding on organizational structure of cooperative;
2. describe the power of the general assembly; and
3. create a cooperative organizational structure.
II - Discussion
A cooperative is a business entity that is member-owned, meaning the business
is controlled and owned by the same people who utilize its services. The owners of the
cooperative finance and operate the business, striving for a mutual benefit by working
together
Definition of Organizational Structure
An organizational structure defines how activities such as task allocation,
coordination, and supervision are directed toward the achievement of organizational
aims. Organizational structure affects organizational action and provides the foundation
on which standard operating procedures and routines rest.
Organizational Structure options: cooperative & corporations are as follows:
• Traditional Cooperative
• New Generation Cooperative
• Cooperative Legal Considerations
• C Corporation
• S Corporation
• Limited Liability Company T
TRADITIONAL COOPERATIVE
A cooperative is a business entity that is member-owned, meaning the business is
controlled and owned by the same people who utilize its services. The owners of the
cooperative finance and operate the business, striving for a mutual benefit by working
together. By combining resources, the overall production costs are decreased, and the
production capabilities and marketing successes are increased. Cooperatives are run
similar to other business entities and usually incorporate under state laws. They require
bylaws and a board of directors, who set policy and hire managers to run the day-to-day
operations. (Rapp & Ely, 1996).
In addition to the user-owned aspect, two other characteristics make a cooperative
different from other business organizations: they are user-controlled, and user-benefited.
The user-controlled characteristic refers to the election of a board of directors and
the ability of common stock holders and/or cooperative members to vote on major
organizational issues. User benefited characteristics include the distribution of resources
based on the member's use of the organization. Cooperatives provide a direct cost
savings through the purchase of bulk supplies, increases in market access, a distribution
of overhead and fixed costs as well as the allocation of profits based on usage to the
members.
Likewise, Cooperative members may finance the start-up and operation costs of
the organization through a variety of methods. One option is for members to make a direct
financial contribution through a membership fee, or through the sale of common or

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preferred stock. Another finance method is for the cooperative to withhold a portion of the
net earnings from cooperative members tor reinvestment back into the organization.
Finally, assessment fees can be charged based on the number of units procured
from each member, or based, on the number of units sold after processing. The
advantage of soliciting a direct contribution or utilizing the sale of stock is the upfront cash
requirements to purchase capital equipment and building services. Assessment fees
and/or net earning withholdings are more beneficial once the cooperative has begun
operations and require working capital or future replacement cash.
It is vital to the success of a cooperative that owners stay informed of the business
practices. A cooperative is a democratically controlled organization that operates through
a majority vote. Members have a monetary interest in the financial well-being of the
organization and rely heavily on the education and success of the other member
producers. While the pooling of resources helps reduce risk in the market place,
judgments and decisions, made on one farm can affect the profitability of other
cooperative members.
NEW GENERATION COOPERATIVE
The "New Generation Cooperative (NGC) is similar in structure to traditional
cooperatives, but the NGC focuses on marketing niche strategies rather than the
traditional cooperative roles, such as production and storage. One of the main focuses of
the NGC is delivery rights, which are tied directly to the initial investment required from
each member. The NGC establishes a production volume, and then sells shares based
on a delivery commitment from farmers, which stipulates that enough of the NGC's
product is produced to fulfil the NGC's capacity requirement. One disadvantage of this
system is the inability of the cooperative to encompass new producers, as the production
capacity is already maximized at inception. However, delivery rights may be sold or traded
to other members of the cooperative and future expansion can allow for the sale of
additional delivery rights.
The New Generation Cooperative (NGO) normally maintain a marketing
agreement with the member producers, whereas traditional cooperatives do not. Because
NGCs are limited to purchasing products from their members only, they require a much
narrower level of quality standards than traditional cooperatives. The process of identity
preserved is used to ensure that an acceptable quality product is grown by members, or
it can trade lower quality member grain for the higher quality grain.
The key advantage to NGCs is the fact that the organization can supply a large
amount of its own start-up capital. NCGs can typically generate 3070-50%% Of their start-
up capital, lowering long- term private debt commitments and freeing up future profits for
larger dividend payments to farmers (Harris, Stefanson, and Fulton, 1996). Additionally,
delivery rights ensure a reliable volume of product for the cooperative, while guaranteeing
a home for the producer s product.
If the members of a cooperative decide that they do not want to offer stock,
membership is derived through membership certificates. Voting rights accompany
membership certificates, which are issued once membership dues are paid. Usually
memberships and capital certificates are insured, but are non-interest bearing. Capital
certificates are similar to preferred stock, but are not issued as stock. They are sold in a
variety of denominations and do not have accompanying voting rights.
Interest may or may not be paid to capital certificate holders, but members may
purchase the certificates.

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NGCs require a marketing contract, making all members producers. In an NGC,
preferred stock and/or capital certificates are generally not offered. After the cooperative
has begun operation, members continue their investment by providing additional risk
capital. This can be accomplished in a variety of ways. The cooperative may retain a
portion of earnings as an additional investment into the organization. This can be done in
two ways: through the payment or retention of a per-unit fee for each member, or through
the retention on the overall cooperatives net earnings. Either way, the equity investment
is credited to the members' equity accounts and held as a liability on the Cooperatives
balance sheet.
COOPERATIVE LEGAL CONSIDERATIONS
The legal considerations cooperatives must consider include the drafting of articles
of incorporation, creating bylaws, membership applications, creating and maintaining
marketing and purchase agreements, and revolving fund certificates. Articles of
incorporation give the cooperative a distinct legal standing. It limits personal liability for
debt incurred by the cooperative, excluding the amount of their initial investment. The
articles of incorporation also describe the nature of the business entity, its location, the
proposed duration of the association, and the names of the principle parties involved.
Constitution and by-laws define how the cooperative will conduct business. The
by-laws describe membership requirements and list the rights and responsibilities of the
cooperative's members. It discusses the voting procedures and the board structure that
will govern the cooperative.
Membership applications are composed of five main parts: the applicant's
statement addressing membership; the signature of the applicant; a statement of
cooperative acceptance, signatures of the board president and secretary; and a
statement of the duties and intent of the prospective member. A membership certificate
may be issued to each member as evidence of entitlements to the organization.
Marketing and purchasing agreements set the standard of quality acceptable to
the cooperative. They also state how the proceeds of the cooperative will be distributed,
once deductions for operating and capital expenditures have been taken. Investing risk
capital is the responsibility of all members. The amount of risk capital invested is an
important decision for the cooperative’s members to consider. It must cover a large
portion of the start-up and operational costs, so that outside investors feel comfortable
that the membership will work to make the operation successful.
C CORPORATION
The C corporation is the traditional form of corporation, which is a business entity
that provides limited liability to its owners and shareholders, meaning the personal assets
of the owners and shareholders are protected from the financial issues of the corporation
(Legalzoom.com, 2006). Unlike a sole proprietorship or partnership, a corporation exists
as a separate legal entity, and therefore is taxed separately from its directors and
shareholders.
The C corporation is managed by a board of directors elected by the corporation's
shareholders and makes policy decisions on the corporation's behalf, while the officers
and employees of the corporation conduct the business dealings of the entity. As
mentioned, the directors, employees, and shareholders of the corporation are not
personally liable for the corporation's debts. However, it is the responsibility of the
directors and officers to ensure that certain formalities are observed on the corporation's
behalf. This includes formalities such as annual meetings, appointment of officers and
election of directors, and issuance of stock. Perhaps the largest responsibility of the

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corporation is to maintain enough capital to protect the corporation from any business
debts. In the event that these formalities are not observed, shareholders may be held
personally liable for corporate debts (note: this type is only applicable in other countries).
S CORPORATION
S corporations are C corporations that have elected to file for S corporation tax
status. Filing as an S corporation combines the limited liability of the C corporation with
the tax status of the sole proprietorship or partnership. The main difference between C
corporations and S corporations (and also the major advantage to S corporations) is the
tax treatment. While C corporations are subject to double taxation, S corporations are
granted "pass through" taxation because all of the corporation's profits are passed on to
the shareholders in the form of dividends, so there is no taxation at the corporate level.
Another advantage to the S corporation is that the corporation's directors may pass
business losses through to their personal income tax return. The biggest disadvantage of
the S corporation is the restrictions that are placed on shareholders: an S corporation
may not have more than 100 shareholders (applicable in other countries)
LIMITED LIABILITY COMPANY
As the name implies, a limited liability company (LLC) is a business ownership
structure that provides limited liability to its owners, called members. The main differences
between the LLC and the corporate structure are that the LLC is more flexible and less
formal than the corporation, and the two entities are subject to different tax laws. An LLC
can also serve as the general partner in a limited partnership, giving the individual owners
protection from liability, financial or otherwise.
As with S corporations, LLCS are also free from double taxation because the LLC
members report their share of profits or losses on their personal income taxes. The LLC
is not taxed at the business entity level. The final advantage to the LLC is the limited
liability the entity provides to its members.
Disadvantages of the LLC are that they do not require an operating agreement,
the lack of which may lead to management issues, and the fact that while the LLC isn’t
subject to double taxation, it may be taxed at a higher rate than a corporation.
Composition of General Assembly
A general assembly is a meeting of all the members of an organization or
shareholders of a company. The general assembly shall be composed of such members
who are entitled to vote under the article of cooperation and by-laws of the cooperative.
Powers of the General Assembly
The General Assembly shall be the highest policy-making body of the cooperative.
It has full authority to decide for the good of the cooperative. The general assembly shall
have the following powers;
a. To determine and approve amendments to the articles of cooperation and by-laws.
b. To elect or appoint the members of the board of directors, and to remove them for
cause.
c. To approve developmental plans of the cooperative.
MEETINGS
A regular meeting shall be held by the general assembly on a date fixed in the
constitution and by-laws, or if not so fixed, on any date within ninety (90) days after the
close of each fiscal year. Hence, providing notice that regular meetings shall be sent in
writing, by posting or publication, or through other electronic facilities and means to inform

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all members of the cooperative (good standing members or in active members considered
as members of cooperative not in good standing) as stated in the record or lists of
members.
Seemingly, whenever necessary, if there is a special meeting of the general
assembly may be called anytime by a majority of the Board of Directors or as provided
for in the Constitution and by-laws of the cooperative.
QUORUM
The minimum number of voting members that must be in attendance at a meeting
of an organization for that meeting to be regularly constituted. A quorum is the number or
proportion of the members of an organization that must be present in order to transact
any business. A quorum shall consist of at least twenty-five percent (25%) of all the
members has the right and entitlement to vote.
On the other hand, quorum of a mass meeting is the number present at the time,
as they constitute the membership at that time. The quorum of a body of delegates, unless
the by-laws provide for a smaller quorum, is a majority of the number enrolled as attending
the convention, not those appointed.
VOTING SYSTEM
Cooperative Principles as stated in RA (9520 CDA) "(2) Democrative Member
Control Cooperatives are democratic C organizations that are controlled by their
members who actively participate in setting their policies and making decisions. Men and
women serving as elected representatives, directors or officers are accountable to the
membership.
Each Member of a primary cooperative shall have only one (1) vote. (one man-one
vote policy)
GENERAL ASSEMBLY RESOLUTION
General Assembly resolutions are generally non- binding towards member states,
internal resolutions may be binding on the operation of the General Assembly itself, for
example with regard to budgetary and procedural matters.
General Assembly resolutions and decisions are formal expressions of the opinion
or will of the Assembly. Some resolutions and decisions, such as those regarding
contributions to the regular and peacekeeping budgets of the organization, may require
action by Member States.
General Assembly Resolution may compose of:
• Development Plan
• Annual Plan and Budget
• Acceptance of Annual Financial Statement
• Hiring of External Auditors
PROCEDURES AND ORDER OF BUSINESS
Source: (CDA, 2019) Cooperative Development Authority / RA 9520
As far as practicable, the order of business of a regular general assembly meeting
shall be:
a. Call to Order;
b. Declaration/Consideration of presence of quorum; (50 percent plus 1)
c. Reading of the previous minutes, consideration and approval of the previous
minutes of the meeting;

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d. Presentation and approval of the reports of the board of directors, officers, and the
committees, including audited financial statements of the cooperative;
e. Unfinished business;
f. New business;
• Election of directors and committee members
• Approval of Development and/or annual plan and budget
• Hiring of External Auditor
• Other related business matters
g. Announcements; and
h. Adjournment

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Name: ______________________________ Program & Year level: ______________
Course & Year: _______________________ Date: ____________________________
Exercise 2
I Can Create It!
Instructions:
1. Identify a certain cooperative in your barangay or municipality where you
belong.
2. Interview through face-to-face or call using the technology to any cooperative
officers in your identified cooperative and gather information about their
organizational structure.
3. If they don’t have any existing organizational chart, try to create an
organizational chart for such cooperative and describe it.
Name of the Cooperative: _____________________________________________
Address of the Cooperative: ___________________________________________
Brief Description of the Cooperative (Include the type of cooperative)
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Organizational Structure
(In this part, present the organizational chart of your identified coop and its description. Use another
sheet if needed.)

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Lesson 3
Types and Categories of Cooperative
1. describe each type of cooperative.
2. Appreciate the important role of the cooperative directions.
II - Discussion
TYPES OF COOPERATIVES
A. Credit Cooperative promotes and undertakes savings and lending services
among its members. It generates a common pool or funds in order to provide financial
assistance and other related financial services to its members for productive and
provident purposes.
B. Consumer Cooperative s to produce and distribute commodities to members for
productive and provident purposes.
C. Producers Cooperative undertakes joint production whether agricultural or
industrial. It is formed and operated by its members to undertake the production and
processing of raw materials or goods produced by its members into finished or processed
products for sale by the cooperative to its members and non-members. Any end product
or its derivative arising from the raw material produced by its members, sold in the name
and for the account or the cooperative, shall be deemed a product of the cooperative and
its members
D. Marketing Cooperative engages in the supply of production inputs to members
and markets their products.
E. Service Cooperative Which engages in medical and dental care, hospitalization,
transportation, insurance, housing, labor, electric light and power, communication,
professional and other services.
F. Multipurpose Cooperative combines (2) or more of the business activities of
these different types of cooperatives.
G. Advocacy Cooperative is a primary cooperative which promotes and advocates
cooperativism among its members and the public through socially-oriented project,
education and training, research and communication, and other similar activities to reach
out to its intended beneficiaries.
H. Agrarian Reform Cooperative organized by marginal farmers majority of which
are agrarian reform beneficiaries for the purpose of developing an appropriate system of
land tenure, land development, land consolidation or land management in areas covered
by agrarian reform.
I. Cooperative Bank organized for the primary purpose of providing a wide range
of financial services to cooperatives and their members.
J. Dairy Cooperative whose members are engaged in the production of fresh milk
which may be processed and / or marketed as dairy products.

16
K. Education Cooperative organized for the primary purpose of owning and
operating licensed educational institutions, notwithstanding the provisions of Republic Act
No. 9155, otherwise known as the Governance of Basic Education Act of 2001.
L. Electric Cooperative organized for the primary purpose of undertaking power
generation, utilizing renewable energy sources, including hybrid systems, acquisition and
operation of sub transmission or distribution to its household members.
M. Financial Service Cooperative organized for the primary purpose or engaging
in savings credit services and other financial services.
N. Fishermen Cooperative organized by the marginalized fishermen in localities
whose products are marketed either as fresh or processed products.
O. Health Services Cooperative organized for the primary purpose of providing
medical, dental and other health services.
P. Housing Cooperative organized to assist or provide access to housing tor the
benefit of its regular members who actively participate in the saving program for housing.
It is co- owned and controlled by its members.
Q. Insurance Cooperative engaged in business for insuring life and property of
cooperatives and their members.
R. Transport Cooperative includes land and sea transportation, limited to small
vessels, as defined or classified under the Philippine maritime laws, organized under the
provision of this Code.
S. Water Service Cooperative organized to own, operate and manage water
systems for the provision and distribution of potable water for its members and their
households.
T. Workers Cooperative organized by workers, including the self-employed, who
are at the same time the members and Owners of the enterprise. Its principal purpose is
to provide employment and business opportunities to its members and manage it in
accordance with cooperative principles; and
U. Other types of cooperative may be determined by the Authority.
CATEGORIES OF COOPERATIVES
Cooperative shall be categorized according to membership and territorial
considerations as follows:
a. In term of membership, cooperative shall be categorized into:
1. Primary. The members of which are natural persons
2.Secondary. The members of which are primaries; and
3. Tertiary. The members of which are secondary cooperatives
b. In terms of territory, cooperatives shall be categorized according to areas of
operations which may or not coincide with the political subdivisions of the country.
How much is the Registration fee?
Prospective cooperatives must submit their application to the (CDA) Cooperative
Development Authority Extension / Satellite Office where the principal office of the
cooperative is located. The following are the amount of fees to be paid for the registration
of cooperatives per CDA per Memorandum Circular 2004-07, Series of 2004.
The initial registration fee to be imposed shall be 1/10 of 1% of the authorized
share capital or the basic fee below whichever is higher.

17
Basic Fees
Primary Cooperatives Php 500.00
Secondary Cooperatives Php 2,000.00
Tertiary Cooperatives Php 3,000.00
Laboratory Cooperatives Php 500.00
(note the basic fees will vary this is only a guidelines)
References:
Philippine Cooperative Code 2008)
(CDA, 2019)) Cooperative Development Authority RA 9520
http://www.cda.gov.ph/resources/ssuances/philippine-cooperative-code-of
2008/republic-act:9520

Module3-Coop-1.pdf

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