members, sold in the name and for the account of the cooperative, shall including hybrid systems, acquisition

ition and operation of subtransmission

be deemed a product of the cooperative and its members. or distribution to its household members.

Marketing Cooperative – one which engages in the supply of Education Cooperative – one organized for the primary purpose of
production inputs to members and markets their products. owning and operating licensed educational institutions
notwithstanding the provisions of Republic Act No. 9155, otherwise
Service Cooperative – one which engages in medical and dental care, known as the Governance of Basic Education Act of 2001.
hospitalization, transportation, insurance, housing, labor, electric light
and power, communication, professional and other services. Agrarian Reform Cooperative – one organized by marginal farmers
majority of which are agrarian reform beneficiaries for the purpose of
Multipurpose Cooperative – one which combines two (2) or more of developing an appropriate system of land tenure, land development,
the business activities of these different types of cooperatives. land consolidation or land management in areas covered by agrarian
reform.
Cooperative Bank – one organized for the primary purpose of
providing a wide range of financial services to cooperatives and their ART. 26. Kinds of Membership. – A cooperative may have two (2)
member. kinds of members, to wit:

Dairy Cooperative – one whose members are engaged in the (1) Regular member - one who has complied with all the membership
production of fresh milk which may be processed and/or marketed as requirements and entitled to all the rights and privileges of
dairy products. membership.

Financial Service Cooperative – one organized for the primary (2) Associate member – one who has no right to vote nor be voted upon
purpose of engaging in savings and credit services and other financial and shall be entitled only to such rights and privileges as the bylaws
services. may provide:

Fishermen Cooperative is one organized by marginalized fishermen Provided, that an associate who meets the minimum requirements of
in localities whose products are marketed either as fresh or processed regular membership, continues to patronize the cooperative for two (2)
products. years, and signifies his/her intention to remain a member shall be
considered a regular member.
Health Services Cooperative – one organized for the primary purpose
of providing medical, dental and other health services. ART. 33. Powers of the General Assembly. – The general assembly
shall be the highest policy-making body of the cooperative and shall
Housing Cooperative – one organized to assist or provide access to exercise such powers as are stated in this Code, in the articles of
housing for the benefit of its regular members who actively participate cooperation and in the bylaws of the cooperative.
in the savings program for housing. It is co-owned and controlled by
its members. Subject to such other provisions of this Code and only for purposes of
prompt and intelligent decision-making, the general assembly may be
Insurance Cooperative – one engaged in the business of insuring life a three-fourths (3/4) vote of all its members with voting rights, present
and poverty of cooperatives and their members. and constituting a quorum, delegate some of its powers to a smaller
body of the cooperative. These powers shall be enumerated under the
Transport Cooperative – one which includes land and sea bylaws of the cooperative.
transportation, limited to small vessels, as defined or classified under
the Philippine maritime laws, organized under the provisions of this ART. 35. Quorum. – A quorum shall consist of at least twenty-five
Code. per centum (25%) of all the members entitled to vote. In the case of
cooperative banks, the quorum shall be as provided in Article 99 of this
Water Service Cooperative – one organized to own, operate and Code. In the case of electric cooperatives registered under this Code, a
manage waters systems for the provision and distribution of potable quorum, unless otherwise provided in the bylaws, shall consist of five
water for its members and their households. per centum (5%) of all the members entitled to vote.

Workers Cooperative – one organized by workers, including the self- ART. 36. Voting System. – Each member of a primary cooperative
employed, who are at same time the members and owners of the shall have only one (1) vote. In the case of members of secondary or
enterprise. Its principal purpose is to provide employment and business tertiary cooperatives, they shall have one (1) basic vote and as many
opportunities to its members and manage it in accordance with incentive votes as provided for in the bylaws but not exceed five (5)
cooperative principles. votes.

Advocacy Cooperative – a primary cooperative which promotes and DISSOLUTION OF COOPERATIVES

advocates cooperativism among its members and the public through
socially-oriented projects, education and training, research and ART. 64. Voluntary dissolution where no creditors are affected. –
communication, and other similar activities to reach out to its intended The dissolution may be affected by the majority vote of the board of
beneficiaries. directors, and by a resolution duly adopted by the affirmative vote of
at least ¾ of all the members with voting rights.
Electric Cooperative – one organized for the primary purposed of
undertaking power generations, utilizing renewable energy sources,
ART. 65. Voluntary dissolution where creditors are affected. – The  Borrowing costs are recognized as expense immediately.
petition for the dissolution shall be filed with authority.  Borrowing costs incurred in connection with the
construction of qualifying assets may be capitalized as part
ART. 66. Involuntary Dissolution – The cooperative may be of the cost of the asset.
dissolved by order of competent court after due hearing on the grounds
of: FOREIGN EXCHANGE

 Violation of any law, regulation or provision of its bylaws;  Transaction is translated into functional currency at the spot
 Insolvency rate at the date of the transaction
 Monetary assets and liabilities are translated using the
ART. 67. Dissolution by order of the authority – The authority may closing rate as of the FS date
suspend or revoke, after due notice and hearing the certificate of
registration of a cooperative on any of the following grounds: EMPLOYEE BENEFITS

 Having obtained its registration by fraud Employee benefits are recognized as expense (or part of the cost of
 Existing for an illegal purpose assets) when incurred.
 Willful violation despite notice by authority of the
provisions of this code or its bylaws Retirement benefit expenses include:
 Willful failure to operate on a cooperative basis
 Failure to meet the required minimum number of members  Current service costs
in the cooperative  Interest cost
 Amortized past service costs
ART. 68. Dissolution by failure to organize and operate  Expected return on pan assets
 Actuarial gains and losses
ART. 69. Liquidation of Cooperative - every cooperative whose
charter expires by its own limitation or whose existence is terminated Past service costs
by voluntary dissolution or through an appropriate judicial proceeding
shall nevertheless continue to exist for three (3) years after the time it  Vested – recognize immediately
is dissolved.  Unvested – to be amortized

ACCOUNTING POLICIES FOR COOPERATIVES BIOLOGICAL ASSETS

RULE 10: CAPITALZATION AND ACCOUNTING Biological assets are living plants and animals
PROCEDURES OF COOPERATIVES
 Initial Measurement – Cost
Legal Basis. The legal basis for this Rule is Art. 71 of the Code, quotes
 Subsequent Measurement
as follows:
 Cost less accumulated depreciation and impairment
losses
ART. 71. Capital – The capitalization of cooperatives and the
 Lower of cost and estimated selling price less cost to
accounting procedures shall be governed by the provisions of this
sell and cost to complete
Code, and the regulations which shall be issued.
INVESTMENT PROPERTY
Capital Sources:

(a) Members’ Share Capital  Investment property shall be accounted for using the cost-
depreciation-impairment model.
(b) Loans and Borrowings including deposits
(c) Revolving Capital  For capital appreciation or rental only for real property.
(d) Subsidies, donations, legacies, grants, aids and such other
assistance form any local or foreign institutions PROPERTY PLANT AND EQUIPMENT

Financial Statement Presentation  PPE shall be counted for using the COST model
 Revaluation of land is allowed but subject to the approval of
 Fair presentation CDA
 Complete set of financial statements
 Going Concern INTANGIBLE ASSETS
 Accrual
 Comparative  Organizational costs are recognized as expense immediately
 Consistency  Research and development costs are recognized as expense
immediately
ACCOUNTING FOR COOPERATIVES  All intangible assets shall be amortized

BORROWING COSTS IMPAIRMENT OF ASSETS