Cooperative Governance Policies

Questions and Answers

What type of cooperative combines two or more business activities from different types of cooperatives?

Bi-purpose

Multipurpose (correct)

Complex

Tri-purpose

Which type of cooperative focuses on promoting and advocating for cooperativism?

Promotional

Social

NGO

Advocacy (correct)

What type of cooperative is primarily organized by marginal farmers and agrarian reform beneficiaries?

Advocacy

Farmers

Agricultural

Agrarian Reform (correct)

Which type of cooperative is responsible for owning, operating, and managing water systems?

Utility Signup and view all the answers

How is a Housing Cooperative characterized in terms of member ownership?

Co-owned and controlled Signup and view all the answers

Which type of cooperative has members that are exclusively natural persons?

Primary Signup and view all the answers

What represents the interests of all types of cooperatives at various administrative levels?

Federation Signup and view all the answers

What are the types of membership typically found in a cooperative?

Regular and associate Signup and view all the answers

What is the timeframe within which the CDA must send a written notice of non-compliance to a cooperative?

15 days Signup and view all the answers

Who conducts the financial audit of a cooperative?

An independent external auditor Signup and view all the answers

Which organization accredits the independent social auditor conducting the social audit?

Cooperative Development Authority (CDA) Signup and view all the answers

What must the board of directors do after receiving the audit report?

Present it to the general assembly in the next meeting. Signup and view all the answers

What is a requirement for the external auditor in terms of their relationship with the cooperative?

They must be independent of the cooperative. Signup and view all the answers

What is stated about the auditor's liability regarding defamation?

The auditor is not liable if actions are performed in good faith. Signup and view all the answers

Who is responsible for promulgating the rules and standards for the social audit of cooperatives?

The Cooperative Development Authority (CDA) Signup and view all the answers

What type of report must be submitted to the board of directors following the audits?

A performance and financial audit report Signup and view all the answers

What is the penalty if a cooperative sells tax-exempt imported goods within five years?

Pay double the amount of the imposed tax and duties Signup and view all the answers

Which of the following is exempt from income tax once registered with the CDA?

Income generated from sales to members Signup and view all the answers

What must be certified by the Department of Trade and Industry (DTI) for cooperatives to import equipment tax-free?

The equipment must not be available locally Signup and view all the answers

What rate of tax is applied to a cooperative's accumulated reserves over Ten million pesos?

Full income tax and other applicable taxes Signup and view all the answers

What type of donations can cooperatives make that are tax-deductible?

Donations to charitable institutions and socioeconomic projects Signup and view all the answers

Which of the following transactions is subject to Value-Added Tax (VAT) for cooperatives?

Transactions with non-members Signup and view all the answers

Which of the following statements about the transfer of beneficial ownership of imported goods is true?

Must not be sold or transferred for up to five years Signup and view all the answers

What is the condition for cooperatives regarding the tax treatment of interest received by individual members?

It follows the same tax rules as the cooperative's income tax Signup and view all the answers

How many years must an associate continue to patronize the cooperative to be considered a regular member?

3 Signup and view all the answers

What type of cooperative is organized by minors?

Youth Signup and view all the answers

Which power of the General Assembly (GA) can be delegated?

To elect or appoint the members of the board of directors and remove them for cause Signup and view all the answers

What fraction of members is required to delegate some of the GA's powers?

2/3 Signup and view all the answers

If not fixed, when must the annual regular meeting of the GA be held after the close of the fiscal year?

60 days Signup and view all the answers

How many days prior to the meeting must notice for a special meeting of the GA be sent to members entitled to vote?

10 days Signup and view all the answers

Which action is NOT a power of the General Assembly?

To revise bylaws Signup and view all the answers

What is the minimum percentage of votes required for the GA to approve amendments?

2/3 Signup and view all the answers

What must a government employee do to attend cooperative meetings during official time?

Notify the end of office concerned. Signup and view all the answers

What is required for a member to withdraw from a cooperative?

Giving a sixty-day notice for valid reasons. Signup and view all the answers

Under what condition can a withdrawing member expect a refund of their contributions?

Only if the cooperative does not suffer a loss from the payment. Signup and view all the answers

Which of the following is NOT a valid ground for termination of membership in a cooperative?

Disagreement with the board's decisions. Signup and view all the answers

Who may assume the responsibilities of an agrarian reform beneficiary-member upon their death or insanity?

The next-of-kin. Signup and view all the answers

What authority has the power to terminate a member's membership in a cooperative?

A simple majority of the board of directors. Signup and view all the answers

What is the potential impact on a cooperative if membership refunds are made?

It may lead to financial strain if debts exceed assets. Signup and view all the answers

Which situation would NOT be considered a valid reason for the termination of membership?

Withdrawal without notice. Signup and view all the answers

Study Notes

Cooperative Employee Attendance

Government employees can utilize official time to attend cooperative meetings and training activities.
Attendance is permitted if it does not disrupt office operations.

Termination of Membership

Members may withdraw for valid reasons with a 60-day notice and are eligible for a refund of share capital unless it jeopardizes cooperative assets.
Membership can end due to death, insanity, or conditions like insolvency in secondary or tertiary cooperatives.
Next-of-kin can continue as members for agrarian reform beneficiaries upon the original member's death or insanity.
The board of directors can also terminate membership by majority vote for specific reasons, including non-compliance with reporting requirements.

Annual Audit Requirements

Cooperatives undergo mandatory annual financial, performance, and social audits.
Financial audits require external auditors who are independent and accredited.
Social audits must be conducted by auditors accredited by the Cooperative Development Authority (CDA).
Audit reports detailing findings and recommendations are submitted to the board.

Audit Report Protocol

Auditors present financial audit reports adhering to accepted auditing standards to the board and audit committee.
Full audit reports must be shared with members at the next general assembly meeting.

Liability and Tax Exemptions

Auditors are not liable for defamation if they act in good faith in their duties.
Cooperatives enjoy exemptions from import duties for machinery not locally available, validated by the Department of Trade and Industry (DTI).
Tax-free imports must not be resold or transferred for five years or incur penalties.

Tax Responsibilities

Cooperatives with over P10 million in reserves must pay full rates on:
- Income Tax for allocated interest on capital (though not personally received by members).
- Value-Added Tax on transactions with non-members.
Contributions to charitable and social projects can qualify for tax deductions.

Cooperative Types and Definitions

Multipurpose Cooperatives engage in various business activities.
Social Cooperatives promote cooperativism, while Agrarian Reform Cooperatives serve marginal farmers.
Water Service Cooperatives manage water systems for potable supply.

Membership and Governance

Housing Cooperatives are co-owned and controlled by their members.
Membership types include primary, secondary, and tertiary based on member profile.
Federations and cooperative unions represent diverse cooperative interests at different levels.
Membership can be classified as regular or associate, with specifics on transitioning from associate to regular membership after two years of patronage.

General Assembly Powers

The General Assembly has powers such as approving contracts, determining amendments, and electing or removing board members.
It can delegate some powers to smaller cooperative bodies by a two-thirds majority vote.
The regular annual meeting must occur within sixty days after the fiscal year-end.

Meeting Notifications

Written notice for special meetings must be sent at least ten days prior to the meeting for members entitled to vote.

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Description

Explore the regulations governing government employees' participation in cooperative activities. This quiz covers attendance at meetings, seminars, and other official events related to cooperatives. Test your knowledge on the rights and duties of officials in cooperative settings.