TRAINING ON

BASIC COOPERATIVE
COURSE
This topic covers the fundamental knowledge of
cooperative that all coops officers should have…
Contents:
1. Fundamentals of cooperatives:
Why, what & how?
2. Cooperative values, principles &
Practices
3. The “ coop difference”
4. Coop governance & administration
SALIENT FEATURES OF
RA NO.6938, 6939 & 9520

• March 10, 1990- President Cory Aquino signed

into law RA6938
(Coop Code Of The Philippines)
• RA 6939- Companion /Twin Law
– Law creating the CDA
• Feb. 17, 2009 – Pres. Gloria M. Arroyo signed
into law RA9520
• (Philippine Cooperative Code of 2008)
• amending RA 6938
WHAT IS COOPERATIVE?
• 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
coop principles.
COOP CONCEPT

• C - controlled

• O - owned

• O - operated

• P - patronized
WHY A COOPERATIVE?

• Socio-Economic & Political Problems:

• Lack of job opportunities
• Inadequate income to support the
family
• Lack of education/knowledge
• Inequality in the distribution of
wealth and power
• wrong values and beliefs
• People are not united
• Peace and order situation
NATURE & CHARACTER OF COOPERATIVES

• COOPERATIVES are:
• Service-oriented
• Community-oriented
• People-oriented
• Owned, managed, and patronized
• Business enterprises
• Develop best through self-help and
mutual help
• Serve best when they answer the real
and felt needs of the members
• Develop best from bottom to top
OBJECTIVES & GOALS

• The primary objective of every coop is to

help improve the quality of life of its
members. The cooperative shall aim to:

– (a) Provide goods and services to its

members to enable them to attain
increased income, savings, investments,
productivity and purchasing power, and
promote among themselves equitable
distribution of net surplus through
maximum utilization of economies of
scale, cost-sharing and risk-sharing;
OBJECTIVES & GOALS

• (b) Provide optimum social

and economic benefits to its
members;

• (c) Teach them efficient ways

of doing things in a
cooperative manner;
• (d) Propagate cooperative practices and
new ideas in business and management;

• (e) Allow the lower income and less

privileged groups to increase their
ownership in the wealth of the nation

• (f) Cooperate with the gov’t, other

coops and people-oriented
organizations to further the attainment
of any of the foregoing objectives
COOPERATIVE PRINCIPLES
• VOLUNTARY and OPEN MEMBERSHIP
– Coops are voluntary organizations, open
to all persons able to use their and
willing to accept the responsibilities of
membership, w/o gender, social, racial,
cultural, political, or religious
discrimination.
DEMOCRATIC MEMBER CONTROL
- coops are democratic organizations
that are controlled by their members
who actively participate in setting their
policies and making decisions.
- members have equal voting rights of
one-member, one-vote.
PRINCIPLES….

• MEMBER ECONOMIC PARTICIPATION

– Members contribute equitably to, and
democratically control, the capital of
their coop.
AUTONOMY AND INDEPENDENCE
- coops are autonomous, self-help
organizations controlled by their
members.
EDUCATION, TRAINING AND
INFORMATION
- coops shall provide education and
training for their members, elected and
appointed representatives, managers,
and employees.
PRINCIPLES…..

• COOPERATION AMONG COOPERATIVES

– -coops serve their members most
effectively and strengthen the coop
movement by working together through
local, national, regional, and international
structures.

CONCERN FOR COMMUNITY

- coops work for the sustainable
development of their communities
through policies approved by their
members.
Cooperative Values, LO 1
Principles & Practice
• Self-help
– In co-operatives, people
• Values help each other whilst (at
the same time) helping
themselves by working
together for mutual
benefit.
• Self-responsibility
– Individuals within
cooperatives act
responsibly and play a full
part in the organization.
Cooperative Values, LO 1
Principles & Practice
• Democracy
• Values – A Co-operative will be
structured so that
members have control
over the organization –
one member, one vote.
• Equality
– Each member will have
equal rights and benefits
(according to their
contribution).
Cooperative Values, LO 1
Principles & Practice

• Values • Equity
– Members will be treated
justly and fairly.

• Solidarity
– Members will support each
other and other co-
operatives.
Cooperative Values, LO 1
Principles & Practice

Ethical Values - In the

• Values tradition of their
founders, co-operative
members believe in the
ethical values of:
 Honesty
 Openness
 Social responsibility
 Caring for others
 COOP Philosophy: LO 1
Nature and Character
Are service oriented
• organized to Are people oriented
serve the • not merely economic
members at a instruments concerned
reasonable cost. with dividends but are
• are not tools for human
charitable development.
institutions.
Are community oriented Owned, managed and
• work for the
patronized by members
welfare of • ownership is an
members by important factor for the
integrating with success of coop
the community
 COOP Philosophy: LO 1
Nature and Character
Serve best when respond to
members needs Develop best thru self-help
• needs of members and mutual-help
must be truly assessed
and responded. • if you want something
• members needs as the done, do it yourself with
basis of service and others
products • self determination and
Are business enterprise self-capacity are very
• engage in business with important
social responsibilities. • self-growth over
• generate surpluses to able dependence
continually to improve and
expand services.
• excess of surpluses are
allocated and returned to
members
COOP Philosophy: LO 1
Nature and Character

Best when developed Development thru multi-

from bottom to top sectoral approach
• ideas must come • help from other
from a group of organization may be
person rather than asked
an individual or requested
• start from something
small to big, one
service to another
service.
 The “Coop Difference” LO 1
COMPARISON OF CO-OPERATIVES WITH OTHER TYPES OF BUSINESS
ENTERPRISES

Basic Single Partnership Corporation Co-operative

Difference Proprietorship

1. Number of Only one person At least two or At least five At least 15 persons
Persons more persons (natural (natural persons
Required for and juridical can be members
Formation persons can be only of primaries;
stockholders at the while juridical
same time) persons can be
members of
federations and/or
unions)

2. Grant No separate Mere agreement Must be registered Must be registered

Juridical juridical of partners can with SEC with CDA
Personality personality from be a partnership.
owner but However, it is
business name better if
should be registered under
registered with DTI the SEC
 The “Coop Difference” LO 1
COMPARISON OF CO-OPERATIVES WITH OTHER TYPES OF BUSINESS
ENTERPRISES

Basic Single Partnership Corporation Co-operative

Difference Proprietorship

3. Registration Application form Contract of Articles of Articles of Co-

Requirements partnership Incorporation, By- operation, By-
for Laws and Bank Laws, Economic
Documentation Statement Survey, Bonds and
Treasurer’s
Affidavit

4. Capitalization Only owner Partners Stockholders pay Members

Contributions contributes contribute cash for amount of contribute (limited
capital or services shares they want to ten percent of
to buy subscribed capital
 The “Coop Difference” LO 1
COMPARISON OF CO-OPERATIVES WITH OTHER TYPES OF BUSINESS
ENTERPRISES

Basic Single Partnership Corporation Co-operative

Difference Proprietorship

General
5. Only one Partners Board of Assembly has
Management person decides make a Directors make final decision
Structure collective final decision
decision

One member,
6. Voting No voting Vote Vote one vote; no
Rights rights as it proportional proportional to proxy voting in
concerns only to interest interest; proxy primary co-ops
one person voting allowed
 The “Coop Difference” LO 1
COMPARISON OF CO-OPERATIVES WITH OTHER TYPES OF BUSINESS
ENTERPRISES

Basic Single Partnership Corporation Co-operative

Difference Proprietorship

7. Liability Unlimited as to Unlimited as to Limited until Limited until

owner partner except authorized capital subscribed share
limited capital
partnerships

Partners pay
8. Taxability Income tax of tax as share on Profits taxable; Net surplus non-
owner partners stockholders pay taxable, interests
tax on dividends on members’
received deposits are not
subject to tax (Art.
61, RA 9520)
 The “Coop Difference” LO 1
COMPARISON OF CO-OPERATIVES WITH OTHER TYPES OF BUSINESS
ENTERPRISES

Basic Single Partnership Corporation Co-operative

Difference Proprietorship

9. Effect of End of business Corporation Co-operative

Death of operations continues; heirs continues; heirs
Owner, unless heirs can Partnership inherit shares become
Partner, take over automatically members if
Stockholder business dissolves qualified
or Member

10. Motive for Profit Profit or Profit Profit and

Existence service service
TYPES OF COOPERATIVES
• a. Credit Cooperative - is one that
promotes and undertakes savings and
lending services among its members. It
generates a common pool of funds in
order to provide financial assistance and
other related financial services to its
members for productive and provident
purposes;
• b. Consumers Cooperative - is one
the primary purpose of which is to
procure and distribute commodities to
members and non- members;
c. Producers Cooperative - is one that
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
materials produced by its members, sold
in the name and for the account of the
cooperative, shall be deemed a product
of the cooperative and its members;
d. Marketing Cooperative - is one which
engages in the supply of production
inputs to members and markets their
products;

e. Service Cooperative - is one which

engages in medical and dental care,
hospitalization, transportation, insurance
housing, labor, electric light and power,
communication, professional and other
services;
f. Multipurpose Cooperative - is one
which combines two (2) or more of the
business activities of these different types
of cooperative;

g. Advocacy Cooperative - is a primary

cooperative which promotes and
advocates cooperativism among its
members and the public through socially-
oriented projects, education and training,
research and communication, and other
similar activities to reach out to its
intended
beneficiaries;
h. Agrarian Reform Cooperative - is
one 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 - is one organized
for the primary purpose of providing a
wide range of financial services to
cooperatives and their members;

j. Dairy Cooperative - is one whose

members are engaged in the production of
fresh milk which may be processed and/or
marketed as dairy products;
k. Education Cooperative - is one
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 - is one
organized for the primary purpose of
undertaking power generation,
utilizing renewable energy sources,
including hybrid systems, acquisition
and operation of substransmission or
distribution to its household
members;
m. Financial Service Cooperative -
is one organized for the primary
purpose of engaging in savings and
credit services and other financial
services;

n. Fishermen Cooperative - is one

organized by marginalized fishermen
in localities whose products are
marketed either fresh or processed;
o. Health Services Cooperative - is one
organized for the primary purpose of
providing medical, dental, and other
health services;

p. Housing Cooperative - is one

organized to assist or provide access to
housing for the benefit of its regular
members who actively
participate in the savings program for
housing. It is co-owned and controlled by
its members;
q. Insurance Cooperative - is one
engaged in the business of insuring life
and property of cooperatives and their
members;

r. Transport Cooperative - is one which

includes land and sea transportation,
limited to small vessels as defined or
classified under the Philippine
Maritime Laws, organized under the
provisions of this Code;
s. Water Service
Cooperative - is one
organized to own, operate
and manage water systems
for the provision and
distribution of potable water
for its members and their
households;
u. Other types of cooperative
as may be determined by the
Authority.
Categories of Cooperative
a)In terms of membership: b) In terms of
(i) Primary- the members of
territory,
which are cooperatives shall
natural
persons
be categorized
(ii) Secondary- the members according to areas
of which are of operation which
primaries
(iii) Tertiary- the members of
may or may not
which are coincide with the
coops
secondary
political subdivision
of the country.
GOVERNANCE AND
ADMINISTRATION
 General Supreme body where

Assembly
all authorities
emanate from

Prepares Conducts
for and
facilitates
the conduct
EleCom BOD ACom. fin., mgt. &
social audit

of election Sets the strategic

direction &

Secretary Treasurer
formulates policies

Con-Med Com Ethics Com EdCom Other Com

Resp of Con- Resp of Ethical Resp of Dev Functions fixed
Med Program & Standards & Plans and imple by BOD
service & Civil Admin Cases educ & training

Gen. Manager
Cases program

Manages the
day-to-day
operations
Performs specific
Mgt. Staff tasks/ functions
related to the day-
to-day operations

Organizational Structure
POWERS, DUTIES AND RESPONSIBILITIES
GENERAL ASSEMBLY-highest policy-
making
body
-compose of members
entitle to
vote
POWERS: (cannot be delegated)
-Determine and approve amendments to the articles of
coop, & By-Laws
-Elect or appoint members of the BOD, and to remove them
for cause.
-Approve developmental plans of the coop.
- Such other matters requiring a two-thirds (2/3) vote of all
members of the general assembly, as provided in the code.
 General
Assembly
The Code specifies matters that require at lease a 2/3
vote of all the members of the general assembly of a
cooperative. These are:
 To amend the articles of cooperative (Art, 18);
 To divide a cooperative (Art. 20);
 To merge or consolidate cooperatives (Art. 21);
 To ratify a voidable cooperative contract (Art. 47);
 To ratify an act of a disloyal director (Art. 48);
 To remove an officer, director or committee member
(Art. 50) and
 To voluntarily dissolve a cooperative (Art. 64 & 65).

Governance & Administration

 General
Assembly
The code also requires only a simple majority vote of the
GA, to wit:
 To fix the compensation of directors (Art. 46);
 To elect directors (Art. 33, par 2 & Art. 43);
 To act on membership applications (Art. 28);
 To act on appeals involving termination of memberships (Art. 30);
 To act on reports (Art. 25);
 To authorize the establishment of revolving funds (Art. 79);
 To act an audit committee reports (Art. 81);
 To decrease the amount allotted to the reserve fund when it exceeds
the share capital (Art. 86);
 To donate any portion or the entire amount of the reserve fund upon the
dissolution of the cooperative (Art. 87); and
 To approve petitions for the suspension of payments or declaration of
insolvency under the Insolvency Law (Art. 64).

Governance & Administration

OFFICERS OF THE COOPERATIVE

• BOD- shall composed of not less than five

(5) nor more than fifteen (15) members elected
by the general assembly
- responsible for the strategic planning,
direction-setting and policy-formulation
activities of the coop.
- Shall not hold any other position directly
involve in the day to day operation &
management of the coop.
• -Term of two (2) years
 Board of Directors
 Sets the strategic direction & formulates policies
 Within the broad policies laid down by the membership, the board of
directors is the governing body. Acting as a group, the directors employ
the manager, establish specific operating policies and supervise the
management of the cooperative. The directors are the elected
representatives of the members. The powers, duties and responsibilities
are:
 Responsible for the strategic planning, direction-setting and policy formulation activities of
the cooperative.
 Formulates and evaluates general and internal operating policies
 Establishes rules and regulations regarding membership; issues and sells share of
stocks.
 Prescribes the form and maintenance of membership records and approve memberships.
 Elect officers of the board, removes them for cause and fills vacancies.
 Exists as a board in a duly-called meeting and their authority does not reside in them as
individuals.
 Hires the best trained and most efficient manager that they can create the best possible
working conditions for him/her that are compatible with the interest of the members and
the success of the cooperatives.
 Determines the duties, responsibilities, and compensation of the general manager and
dismiss him/her for cause

Governance & Administration

 Board of Directors
 The powers, duties and responsibilities are:
 Employs an external auditor
 Determines which employees to be bonded, fixed the amount of their bonds,
and provides for the adequate insurance protection for all facilities, equipment,
and personnel.
 Prescribes the form, extent and nature of financial reports to members.
 Declares interest on capital and patronage refund on business volumes.
 Recommends changes in the by-laws (when the power to do is vested in the
directors)
 Borrows money and issues evidence of indebtedness
 Consolidates funds and decides investments in other cooperatives
 Enters into contracts, sues and be sued in the name of coop
 Renders services, furnishes supplies and markets products for members and
partners in accordance with the purposes of the coops as spelled out in the
organization papers
 Keeps records of all meetings of the board
 Calls special meeting of the board
 Adapts, uses, and alters the cooperative seal.

Governance & Administration

 Board of Directors
 The powers, duties and responsibilities are:
 Observes moral and legal responsibility to serve the best interest of the
members whom they represent rather than their own individual interest.
 Knows and understands the financial operations of the cooperative and satisfy
themselves that the records kept are accurate in every detail.
 Keeps the membership informed and insures that the entire organization is
permeated with spirit of service to and respect for the membership.
 Does not interfere in the day to day operations of the business but should
determine with the membership, the policies of operation and checks to see
these policies are carried out.
 Maintains the cooperative as an efficient business institution worthy of the
good will of the community and area it serves.
 The BOD shall be responsible for the strategic planning, direction setting and
policy-formulation activities of the cooperative.
 Manages the properties of the cooperative.
 Formulates the development philosophy and direction of the Coop.
 Acts on all applications for membership, resignations and in certain cases,
expulsion of members, and
 May exercise all powers of the cooperative which are not reserved for the
general assembly under R.A. Act 6938 and by laws.

Governance & Administration

COMMITTEES
• ELECTIVE COMMITTEES

• AUDIT COMMITTEE
- have the power and duty to continuously
monitor the adequacy and effectiveness of the
coop’s management control system and audit
performance of the coop

- Prepares and submits periodic and regular

reports to the Board and to the General Assembly.

- Calls for special assemblies whenever

necessary.

- serve as financial consultant to the BODs

• ELECTION COMMITTEE
- plan, prepare and
supervise the conduct of all
elections
- receive and conduct
hearing on election protests and
submit results to the BOD
- proclaim the elected
officers to the BOD and elective
committees.
APPOINTIVE COMMITTEES
• EDUCATION & TRAINING COMMITTEE

-Develop, plan, and implement educational and information

activities
- Conduct seminars for prospective and regular members
- Conducts the educational program of the Coop which
includes among others, the pre-membership seminars and
ownership meetings, the training of directors, officers,
committee members and paid staff of the Coop.
- Provides members with information concerning operations
of the Coops during regular ownership meetings.
- Familiarizes the general public with the aims, purposes and
philosophy of the cooperative movement, and
- Recommends to the BOD related policies and program of
education and training for the Coop.
• OTHER COMMITTEES – as may be necessary
for the conduct of the affairs of the cooperative,
- shall assist in the
formulation of policies and rules and in the
implementation of the services of the coop
- powers, functions, &
responsibilities shall be defined in the by-laws.

» Mediation and Conciliation

Committee
» Ethics Committee
Appointive Committee

• CONCILIATION-MEDIATION COMMITTEE
a) Formulate and develop the Conciliation-Mediation Program and
ensure that it is properly implemented;
b) to conciliate, hear and decide all intra-cooperative disputes
between and/or among members, officers, directors and
community.
c) issue supplemental rules and procedures concerning
conciliation process as may be deemed necessary (for GA
approval)
d) Submit recommendations for improvement to the Board of
Directors;
e) Recommend to the Board of Directors any member of the
cooperative for Conciliation-Mediation Trainings as Cooperative
Conciliator-Mediator;
f) Issue the Certificate of Non-Settlement (CNS);
g) other powers as may be necessary to ensure speedy, just,
equitable and inexpensive settlement of disputes within the
Cooperative.
Appointive Committee
• ETHICS COMMITTEE
- develop Code of Governance and Ethical
Standards to be observed by the members, officers and
employees of the cooperative(for BOD and GA approval)
- disseminate, promote, implement and
monitor the compliance with the Code of Governance &
Ethical Standards.
-Conduct initial investigation or inquiry upon
receipt of a complaint involving Code of Governance
and Ethical Standards and submit report to the
Board of Directors together with the appropriate
sanctions.
-Recommend ethical rules and policy to the
Board of Directors;
• SECRETARY- keep & maintain a complete
registry of all members and records/minutes
of all meetings of the BOD and GA
- give notice of all
meetings called
- keep & maintain the
Share and transfer book and serve as the
custodian of the corporate seal of the coop
- turn over to his
successor all books, records & other
properties belonging to the coop
- act as a treasurer in
case of the
latter’s absence
• TREASURER- take custodies of all monies,
securities and papers acquired by the coop,
- maintain complete records
of all its cash transactions
- pay all financial obligations
of the coop as approved by the GM & BOD
- render report and certify the
correctness of the cash position of the coop in all
financial statements and other reports submitted to
the BOD, GA, & the CDA.
- turn over to his successor all
monies, papers, books, and other properties of the
coop
- acts as Secretary in case of
the latter’s absence
MANAGEMENT STAFF

• MANAGER
-spearhead of all management
Has a dual challenge:
(a) solve the technical business
problems
(b) manage the accounting,
financing, personnel and

other problems of
business operation
- ensure compliance with all
administrative and other requirements of
regulatory bodies
General Manager. The General Manager shall:
a. Oversee the overall day to day business operations of the cooperative by providing
general direction, supervision, management and administrative control over all the
operating departments subject to such limitations as may be set forth by the Board of
Directors or the General/Representative Assembly;
b. Formulate and recommend in coordination with the operating departments under
his/her supervision, the Cooperative's Annual and Medium Term Development Plan,
programs and projects, for approval of the Board of Directors and ratification of the
General/Representative Assembly;
c. Implement the duly approved plans and programs of the Cooperative and any other
directive or instruction of the Board of Directors.
d. Provide and submit to the Board of Directors monthly reports on the status of the
Cooperative's operation vis-à-vis its targets and recommend appropriate policy or
operational changes, if necessary;
e. Represent the Cooperative in any agreement, contract, business dealing, and in any
other official business transaction as may be authorized by the Board of Directors;
f. Ensure compliance with all administrative and other requirements of regulatory
bodies; and
g. Perform such other functions as may be prescribed in the By-laws or authorized by
the General/Representative Assembly.
• ACCOUNTANT/BOOKKEPER
- install an adequate and
effective accounting system w/in the coop
- render reports on the
financial condition and operations of the coop
monthly or annually
- provide assistance to the
BOD in the preparation of annual budget
- keep, maintain & preserve
all books of accounts, documents, vouchers,
contracts & other records concerning the
business of the coop & make them available
for auditing purposes
NOTE……..
• All elective officials of the Gov’t shall be an
illegible to become officers & directors of the
coop

• No 2 or more persons w/ relationship up to the

3rd civil degree consanguinity or affinity shall
serve as an appointive officer.
 RELATIONSHIP COVERED BY
PROHIBITION
DEGREE RELATIONSHIP

By Consanguinity By Affinity

1st Degree Parents to son/daughter Parents-in-law to son/

daughter-in-law
2nd Degree Grandparent to grandchild, Grandparent-in-law to
Brother/Sister grandchild-in-law,
Brother/Sister-in-law to
sister/brother-in-law

3rd Degree Great grandfather to great Great grandfather-in-law

grandchild, uncle/aunt to to Great grandchild-in-law
nephew/niece Uncle/aunt-in-law to
Nephew/niece-in-law
SAVING MOBILIZATION & CAPITAL BUILD-UP
PROGRAM (SM CBUP)

• CAPITAL BUILD-UP
• A coop shall have a capital formation process for the
operation of its business.
• Article 72- Capital Sources- Coops registered under 9520
may derived their capital from any or all of the following sources:
- Member’s share capital
- Loans and borrowing including deposits
- Revolving capital w/c consists of the
deferred payment of patronage refunds, or interest on
share capital
- Subsides, donations, legacies, grants, aids
and such other assistance form any local or foreign
institution whether public or private.
• LIMITATION ON SHARE CAPITAL
HOLDINGS-
– No member of a primary coop other than a
coop itself shall own or hold more than 10%
the share capital of the coop.

• CAPITAL BUILD-UP PROGRAM-

– Allow the continuing growth of the members’
investments in their coop as their own
economic conditions continues to improve
 • SAVING MOBILIZATION
– --Saving is encouraged to coop to augment the group
business that members engage into, it could be used
for expansion of the enterprise.

• -Saving schemes used by most coops:

– 1. Piso-piso deposit or one peso a day savings

– 2. Birthday regalo (for Christians) & Ramadhan
Regalo (muslim)
– 3. Raffle tickets or Raffle draw
– 4. Twenty five centavo’s retention to every item being
sold by coop
– 5. Other saving scheme.
ALLOCATION AND DISTRIBUTION OF NET SURPLUS

• NET SURPLUS- (ARTICLE 85)

– -Net surplus shall not be construed as

profit but as an excess of payments
made by the members for the loans
borrowed, or the goods and services
availed by them from the coop.
ORDER OF DISTRIBUTION
• GENERAL RESERVE FUND
• - at least 10% of net surplus.
- not be less than 50% of the net
surplus in the first 5 years of operation after registration
- shall be used for the stability of
the cooperative and to meet losses.
- shall not be utilized for investment
- upon dissolution, the fund shall
not be distributed among the members
• EDUCATION & TRAINING FUND

-not more than 10% of the net

surplus
-shall provide for the training,
development and similar other
Coop activities geared towards the
growth of the coop movement
- Half of the amount may be
remitted to a union or federation of
which it is a member.
• COMMUNITY DEVELOPMENT
FUND

- Not less than 3% of the net

surplus
-Shall be used for projects or
activities that will benefit the
community where the coop
operates.
• OPTIONAL FUND

-Shall not exceed 7%

-Used for land and building,
and other necessary fund
• ***The remaining net surplus
shall be made available to the
members in the form of
Interest on Share Capital and
Patronage Refund.
THE COOP PROCESS

WELFARE

Articles of
GENERAL
ASSEMBLY Cooperation, By-
OR Elects/Appoints BOD’s Plan & Formulate laws, Rules and
GENERAL Committee Regulation, Other
MEMBERSHIP Members Policies
Other
Officers
• Role of General Assembly:

–Be knowledgeable
–Be Vigilant
–Be Active
SUCCESS FACTORS

• Members recognition of common needs

• Members determination to help themselves
• Members conviction that group action offer
advantageous
• Presence of good members & capable
dedicated leaders
• Good record keeping system
• Frequent audit
• Continuous Coop education
• Training of officers & members
• Proper guidance
• Other factor: Financial assistance
REQUIREMENTS
( per MC No. 2011-15, dated May 6, 2011)

1. Cooperative Name Reservation Notice (CNRN)

2. Economic Survey
3. Articles of Cooperation and the approved By-laws;
3.1 All original;
3.2 The Articles of Cooperation shall be signed by all the cooperators on
each and every page; and
3.3 The By-laws shall be signed by all the members on the adoption page.
4. Treasurer’s Affidavit;
5. Surety Bonds of Accountable Officers;
6. Certificate of Pre-membership Educ. Seminar (PMES) signed by the cooperative
interim Chairman, as validated by the Authority;
7. Undertaking to change name;
8. Undertaking to comply with the auditing and accounting standards prescribed by the
Authority;
9. Undertaking to submit reportorial requirements and to comply with other
requirements prescribed by the other regulatory agency, when applicable;
10. Favorable endorsement/ written verification / authority/ pre-feasibility study, if
applicable; and
11. Registration Fee.
GENERAL INSTRUCTIONS
1. All interim board of directors must affix their signatures
on the margin of every page thereof except the page
where the names and signatures of cooperators are
provided;
2. All four(4) copies of the articles of cooperation shall
bear original signatures;
3. No photocopy of documents shall be accepted;
4. The paper must be in 8.5” x 13” or 8.5” x 14” and the
font type and size is Bookman Old Style, 12;
5. Four (4) copies of documents must be submitted in
separate folders; and
6. The use of metallic objects in fastening the documents
is not allowed.