.........................................................................................................................................
\n
3.
\n
Reasons Give detailed reasons for forming the society .................................................................................................................................. ..................................................................................................................................
\n
4.
\n
Source of membership support Briefly describe the main occupation or employment, or residential area, or other bond of association or occupation of the people expected to become members .................................................................................................................................. .........................................................................................................................................
\n
5.
\n
Attitude towards community projects Do the people referred to in item 4 work together in voluntary projects to benefit the community or area in which they live, or the occupational, employment or other group to which they belong?
\n
6.
\n
Expected membership (a) Number of persons ready to join now. (b) Estimated number of persons expected to join within the first year of operation ......................................................................................................................................... ...... ..................................................................................................................................
\n
7.
\n
Management If the society is registered, will the services of a competent manager (or secretary or treasurer) be available? ......................................................…….……………………….
\n
CO-OPERATIVE SOCIETIES (a) Name ...................................................…………………...…………….. (b) Experience and training ..........................................…………...……….. (c) Will he be able to keep or supervise the keeping of accurate books or records? ............................................................................................................................. .............................................................................................................................
\n
8.
\n
Financial participation by members (a) Will members provide share capital or other funds to start the society and continue to give it financial support after operations commence? ............................................................................................................................. (b) Value of each share .................... euro. Total expected to be paid on shares and/or subscriptions when operations commence ..................... euro. (c) Total paid-up membership fees expected when operations commence…...… euro.
\n
Total entrance fees to be paid when operations commence ......……… euro. (d) From what source of income will members provide the capital required? (e.g. salaries, wages, business, etc.) …..............................……………………… 9.
\n
Educational meetings Have educational meetings been held to discuss the proposed society, its operations and its benefits to members if they support it? ............................................................................................................................. (a) If so, how many? .......................……………...........………………… (b) Average number of attendance .......………..............……………….. (c) Speakers………………………………………………………………..
\n
10.
\n
Discussion on Statute Have study and discussion groups been organised to involve and inform people who wish to become members? ....…………………………………………………..
\n
Has a model statute been discussed? If so, when, how, by whom and with whose assistance? ..…………………......….........……………….
\n
11.
\n
Office space If office space, a building or equipment is required for the purposes of the society, how will this be obtained and financed ? ..................................................................................................................................
\n
CO-OPERATIVE SOCIETIES .........................................................................................................................................
\n
12.
\n
Planning and Technical Advice Has advice been obtained on whether planning of the proposed society seems adequate and whether it has reasonable prospects of success if the members give it their support? ................................................................................................…………………………..
\n
If so, give the source of such advice ………………………...............……………… .................................................................................................................................. .........................................................................................................................................
\n
13.
\n
Consultation with an officer of the Board Has an officer of the Board been consulted on the need for the proposed society and necessary preparations for organisation? (give details) .................................................................................................................... .................................................................................................................................. ..................................................................................................................................
\n
Dated at…………………… the.......................... day of ……..……. 20 ...
\n
Names and signatures of original prospective members: ………………………………………………….. ………………………………………………….. …………………………………………………..
\n
SECOND SCHEDULE Article 34(2) The following is a non-exhaustive list of matters required to be included in the statute of a Co-operative Society:
\n
1.
\n
The name of the society.
\n
2.
\n
The place and postal address of its registered office.
\n
3.
\n
The objects of the society.
\n
4.
\n
The geographical area of operation of the society.
\n
5.
\n
The purposes to which the society’s fund may be applied.
\n
6.
\n
The value of each share, if the society is formed with share capital, or the minimum amount of monthly subscriptions.
\n
7.
\n
The qualifications for membership, the terms of admission of members, the CO-OPERATIVE SOCIETIES entrance or affiliation fees, if any, payable, and the mode of admission.
\n
8.
\n
The manner of raising share capital, if any, and other funds and the terms of withdrawal or transfer of shares and, or, subscription capital.
\n
9.
\n
The rights and obligations of members and the extent of the liability of members for debts of the society.
\n
10.
\n
The conditions in which a member may withdraw from membership, including the procedure whereby the nominal value of the shares held by a withdrawing member shall be redeemed.
\n
11.
\n
The mode of summoning and conducting meetings, and the rights of voting.
\n
12.
\n
The powers and duties of general meetings, committee of management, officers, and supervisory board (where applicable).
\n
13.
\n
The mode of election, appointment, suspension and removal of the committee of management, the supervisory board (where applicable), and officers of the society.
\n
14.
\n
The legal and judicial representation of the society, including the authorisation of an officer or officers to sign documents and otherwise act on behalf of the society.
\n
15.
\n
The method of constituting, operating and allocating the reserve fund and the amount or method of fixing the amount to be contributed thereto.
\n
16.
\n
The disposal of the annual net surplus.
\n
17.
\n
The honoraria or allowances, if any, to be paid to officers of the society.
\n
18.
\n
Restrictions of transactions with persons other than members, if any.
\n
19.
\n
In the case of a society the objects of which include the creation of funds to be lent to the members, additional rules in its statute with respect of the following matters: (a) the conditions on which loans may be made to members, including (i) the maximum rate of interest; (ii) the maximum period allowed for the repayment of a loan; (iii) the extension of the term and renewal of a loan; (iv) the purposes for which a loan may be granted; and (v) the security required for repayment. (b) the consequences of default in payment of any sum due on account of shares, subscriptions, deposits or loans and the consequence of failure to use a loan for the purpose for which it was granted; (c) the occupation or residence of persons who may become members; and (d) the conditions on which loans and deposits may be received from members and non-members and the extent to which the society may borrow from members and non-members.
\n
20.
\n
In the case of a secondary society or tertiary society or the Apex organisation, the method of representation of members at general meetings, the removal of delegates CO-OPERATIVE SOCIETIES and the manner of voting of delegates.
\n
21.
\n
If deemed appropriate, rules distinguishing between active members and nonactive members in relation to the qualification for membership of the society and any other matters related thereto.
\n
22.
\n
Rules in respect of any other matter incidental to the management of the society’s business.
\n
23.
\n
If deemed appropriate, rules with respect to the referral of disputes to the Arbitration Centre.
\n
24.
\n
The maximum rate that the society may pay to its members by way of dividend.
\n
25.
\n
If deemed appropriate, the provision of proxy rights.
\n
26.
\n
If deemed appropriate, the provision of holding general meetings through suitable electronic or other means.
\n
27.
\n
The maximum amount that a society may borrow, including bank overdrafts.
\n
28.
\n
A procedure for the expulsion of members.
\n
29.
\n
If deemed appropriate, the provision for including the possibility of having commercial partnerships as members.
\n
30.
\n
The manner for convening the annual general meeting.
\n
31.
\n
The number of members composing the committee of management.
\n
32.
\n
Restrictions on members in relation to membership in other societies having the same or similar objects or in relation to activities carried out in competition with those of the society.
\n
33.
\n
Rules on the transmission of shares causa mortis.
\n
34.
\n
Rules concerning the majority of votes required for amendments to the statute, conversions, amalgamations or dissolution of the society.
\n
35.
\n
Rules on the receipt, expenditure and investment of monies and the acquisition and disposal of assets by the society.
\n
36.
\n
If deemed appropriate, the provision for requiring a second general meeting to confirm a resolution for the dissolution of the society.
\n
37.
\n
If deemed appropriate, the provision for the distribution of any part of the net surplus of a society among its members in the form of bonus certificates or bonus shares.
\n
CO-OPERATIVE SOCIETIES THIRD SCHEDULE Amended by:
\n
L.N. 426 of 2007.
\n
FORM AND CONTENT OF INDIVIDUAL ACCOUNTS
\n
PART I - GENERAL RULES AND FORMATS
\n
General rules 1.
\n
(1)Subject to the following provisions of this Schedule - (a) every balance sheet of a society shall show the items listed in the balance sheet format set out immediately following paragraph 13 of this Schedule: and (b) every income and expenditure account of a society shall show the items listed in the income and expenditure account format set out immediately following the balance sheet format, in either case in the order and under the headings and subheadings given in the format adopted. For this purpose the words in brackets against the headings, the subheadings and the items are explanatory and do not have to be reproduced in the individual accounts.
\n
(2)Sub-paragraph (1) is not to be read as requiring any item, or the heading or subheading for any item, to be distinguished by any letter or number assigned thereto in the format adopted.
\n
2.(1) Where, in accordance with paragraph 1, a society’s balance sheet or income and expenditure account for any accounting period has been prepared by reference to one of the formats set out herein, the committee of management of the society shall adopt the same format in preparing the financial statements for subsequent accounting periods of the society unless, in their opinion, there are special reasons for a change.
\n
(2)Particulars of any change in the format adopted in preparing a society’s balance sheet or income and expenditure account in accordance with paragraph 1 shall be disclosed, and the reasons for the change shall be explained, in the notes to the accounts drawn up when the new format is first adopted.
\n
3.(1) Any item required in accordance with paragraph 1 to be shown in a society’s balance sheet or income and expenditure account may be shown in greater detail than required by the format adopted.
\n
(2)A society’s balance sheet or income and expenditure account may include an item representing or covering the amount of any asset or liability, income or expenditure not otherwise covered by any of the items listed in the format adopted, but the following shall not be treated as assets in a society’s balance sheet (a) expenses of and commission on any issue of shares; and (b) costs of research.
\n
Any additional items as aforesaid shall be included under either an existing heading or subheading or under a new heading or subheading as appropriate.
\n
(3)The layout, nomenclature and terminology of items in the balance sheet and CO-OPERATIVE SOCIETIES income and expenditure account that are preceded by Arabic numerals shall be adapted where the special nature of an undertaking so requires.
\n
(4)Items to which Arabic numbers are assigned in any of the formats set out herein may be combined in a society's individual accounts for any accounting period if either (a) their individual amounts are not material to assessing the state of affairs or surplus or loss of the society for that accounting period; or (b) the combination facilitates that assessment, but where the provisions of sub-paragraph (b) apply, the individual amounts of any items so combined shall be disclosed in the notes to the accounts.
\n
(5)Save where there is a corresponding item for the preceding accounting period, a balance sheet or income and expenditure account item for which there is no amount shall not be shown. In such case, the heading or subheading in respect of that item shall also not be shown if that item is the only one under such heading of subheading.
\n
4.(1) In respect of every item shown in a society’s balance sheet or income and expenditure account or in the notes to the accounts, there shall also be shown the corresponding amount for the accounting period immediately preceding that to which the individual accounts relate.
\n
(2)Where that corresponding amount is not comparable with the amount to be shown for the item in question in respect of the accounting period to which the individual accounts relate, the former amount shall be adjusted and particulars of the adjustment and the reasons for it shall be disclosed in the notes to the accounts. Such adjustments shall be made in accordance with generally accepted accounting principles and practice.
\n
5.
\n
Save as otherwise provided in this Schedule, or as may be permitted by generally accepted accounting principles and practice, any set-off between asset and liability items, or between income and expenditure items, shall be prohibited.
\n
6.(1) In determining whether particular assets are to be shown as fixed assets or current assets reference shall be made to the purpose for which they are intended.
\n
(2)Fixed assets shall comprise those assets which are intended to be held on a continuing basis in connection with the undertaking’s activities.
\n
(3)Where an asset or liability relates to more than one layout item, its relationship to the other item or items shall be disclosed either under the item where it appears or in the notes to the accounts, if such disclosure is essential to the comprehension of the individual accounts.
\n
(4)Shares in secondary and tertiary undertakings may be shown only under the items prescribed for that purpose.
\n
7.(1) \"Provisions for liabilities or charges\" are intended to cover losses or debts the nature of which is clearly defined and which at the date of the balance sheet are either likely to be incurred, or certain to be incurred but uncertain as to amount or as to the date on which they will arise.
\n
(2)\"Provisions for liabilities or charges\" may not be used to adjust the values of assets.
\n
CO-OPERATIVE SOCIETIES 8. (1) \"Secondary and tertiary societies\" shall have the meaning assigned to it by the Act.
\n
(2)\"Turnover\" shall comprise the amounts derived from the sale of products and the provision of services falling within the society’s ordinary activities, after deduction of sales rebates and taxes directly linked to the turnover.
\n
9.(1) Income and charges that arise otherwise than in the course of the society’s ordinary activities shall be shown under \"Extraordinary Income\" and \"Extraordinary Charges\".
\n
(2)Unless the income and charges referred to in sub-paragraph (1) hereof are immaterial for the assessment of the results, explanations of their amount and nature shall be given in the notes to the accounts. The same shall apply to income and charges relating to another accounting period.
\n
10.(1) Every income and expenditure account of a society shall show the amount of the society’s surplus or loss on ordinary activities before taxation.
\n
(2)Taxes on the surplus or loss on ordinary activities and taxes on the extraordinary surplus or loss may be shown in total as one item in the income and expenditure account before \"Other Taxes not shown under the above items\". In such a case \"Surplus or Loss on Ordinary Activities after Taxation\" shall be omitted from the income and expenditure account layouts prescribed in this Schedule.
\n
(3)Where this derogation is applied there shall be disclosed in the notes to the accounts the extent to which the taxes on the surplus or loss affect the surplus or loss on ordinary activities and the extraordinary surplus or loss.
\n
11.Every surplus and loss account of a society shall show separately as additional items: (a) any amount set aside or proposed to be set aside to, or withdrawn or proposed to be withdrawn from, reserves; and (b) the aggregate amounts of (i) any dividends paid; and (ii) any dividends proposed.
\n
12.(1) The provisions of this Schedule shall be interpreted by reference to the application of generally accepted accounting principles and practice to give a true and fair view within the meaning of this Act.
\n
(2)Amounts which in the particular context of any provision of this Schedule are not material may be disregarded for the purposes of that provision.
\n
Required formats for accounts 13. References in this Schedule to the items listed in any of the formats set out below are to those items read together with any of the notes in the formats which apply to any of those items, and the requirement imposed by paragraph 1 to show the items listed in any such format in the order adopted in the format is subject to any provision in those notes for alternative positions for any particular items.
\n
CO-OPERATIVE SOCIETIES BALANCE SHEET FORMAT A.
\n
Called Up issued share capital not paid (may be shown in either of the two positions herein) B.
\n
Formation Expenses (may be shown as the first item under \"Intangible Assets\") C.
\n
Fixed Assets I.
\n
Intangible Assets 1.
\n
2.
\n
3.
\n
4.
\n
II.
\n
Tangible Assets 1.
\n
2.
\n
3.
\n
4.
\n
III.
\n
Development costs Concessions, patents, licences, trade marks and similar rights and assets (if these were acquired for valuable consideration and are not to be shown under goodwill or these were created by the society itself) Goodwill (only to the extent that this was acquired for valuable consideration) Payments on account Land and buildings (including all rights on immovables) Plant and machinery Other fixtures, fittings, tools and equipment Payments on account and tangible assets in the course of construction Financial Assets 1.
\n
2.
\n
3.
\n
4.
\n
5.
\n
6.
\n
7.
\n
8.
\n
9.
\n
10.
\n
11.
\n
Loans to members Shares in secondary societies Loans to secondary societies Shares in tertiary societies Loans to tertiary societies Shares in subsidiary undertakings Loans to subsidiary undertakings Shares in associated undertakings Loans to associated undertakings Other investments other than loans Other loans D.
\n
Current Assets I.
\n
Stocks l.
\n
2.
\n
3.
\n
4.
\n
Raw materials and consumables Work in progress Finished goods and goods for resale Payments on account CO-OPERATIVE SOCIETIES II.
\n
Debtors (The amount falling due after more than one year shall be shown separately for each item included under debtors) l.
\n
2.
\n
3.
\n
4.
\n
5.
\n
6.
\n
7.
\n
8.
\n
9.
\n
III.
\n
Investments 1.
\n
2.
\n
3.
\n
4.
\n
5.
\n
IV.
\n
Trade debtors Amounts owed by members Amounts owed by secondary societies Amounts owed by tertiary societies Amounts owed by subsidiary undertakings Amounts owed by associated undertakings Other debtors Called up issued share capital not paid (may be shown in either of the two positions herein) Prepayments and accrued income (may be shown in either of the two positions herein) Shares in secondary societies Shares in tertiary societies Shares in subsidiary undertakings Shares in associated undertakings Other investments Cash at Bank and in Hand E.
\n
Prepayments and Accrued Income (may be shown in either of the two positions herein) F.
\n
Creditors: Amounts falling due within One Year 1.
\n
2.
\n
Bank loans and overdrafts Payments received on account (payments received on account of orders shall be shown here in so far as they are not shown as deductions from stocks) 3. Trade creditors 4. Bills of exchange payable 5. Amounts owed to members 6. Amounts owed to secondary societies 7. Amounts owed to tertiary societies 8. Amounts owed to subsidiary undertakings 9. Amounts owed to associated undertakings 10. Amounts owed to the Central Co-operative Fund 11. Other creditors including taxation and social security (the amounts for creditors in respect of taxation and social security shall be shown separately from the amount for other creditors) 12. Accruals and deferred income CO-OPERATIVE SOCIETIES G.
\n
Net Current Assets/Liabilities (in determining the amount to be shown for this item any amounts shown under \"prepayments and accrued income\" shall be taken into account wherever shown) H.
\n
Total Assets less Current Liabilities I.
\n
Creditors: Amounts falling due after more than one year 1.
\n
2.
\n
Bank loans and overdrafts Payments received on account (payments received on account of orders shall be shown here in so far as they are not shown as deductions from stocks) 3. Trade creditors 4. Bills of exchange payable 5. Amounts owed to members 6. Amounts owed to secondary societies 7. Amounts owed to tertiary societies 8. Amounts owed to subsidiary undertakings 9. Amounts owed to associated undertakings 10. Other creditors including taxation and social security (the amounts for creditors in respect of taxation and social security shall be shown separately from the amount for other creditors) 11. Accruals and deferred income J.
\n
Provisions for Liabilities and Charges 1.
\n
2.
\n
3.
\n
K.
\n
Pensions and similar obligations Taxation, including deferred taxation Other provisions Capital and Reserves I.
\n
Called Up Issued Share Capital (in addition, the amount of the issued share capital and the amount of the called up issued share capital which has been paid up shall be shown separately in the notes to the accounts) II.
\n
Reserve Fund III.
\n
Share Premium Account IV.
\n
Revaluation Reserve V.
\n
Other Reserves 1.
\n
2.
\n
3.
\n
VI.
\n
Capital redemption reserve Reserves provided for by the statute Other reserves Accumulated Surplus and Deficit Account CO-OPERATIVE SOCIETIES INCOME AND EXPENDITURE ACCOUNT FORMAT 1.
\n
Turnover 2.
\n
Cost of sales (after taking into account any necessary provisions for depreciation or diminution in the value of assets) 3.
\n
Gross surplus or loss 4.
\n
Distribution costs (after taking into account any necessary provisions for depreciation or diminution in the value of assets) 5.
\n
Administrative expenses (after taking into account any necessary provisions for depreciation or diminution in the value of assets) 6.
\n
Other operating income 7.
\n
Income from shares in secondary societies 8.
\n
Income from shares in tertiary societies 9.
\n
Income from shares in subsidiary undertakings 10.
\n
Income from shares in associated undertakings 11.
\n
Income from other financial fixed assets (income, including interest, derived from members, secondary and/or tertiary and/or subsidiary and/or associated undertakings shall be shown separately from income derived from other sources) 12.
\n
Other interest receivable and similar income (interest and similar income derived from members, secondary and/or tertiary and/or subsidiary and/or associated undertakings shall be shown separately from that derived from other sources) 13.
\n
Amounts written off in respect of financial fixed assets and investments held as current assets 14.
\n
Interest payable and similar charges (the amount payable to members, secondary and/or tertiary and/or subsidiary and/or associated undertakings shall be shown separately) 15.
\n
Tax on surplus or loss on ordinary activities 16.
\n
Surplus or loss on ordinary activities after taxation 17.
\n
Extraordinary income 18.
\n
Extraordinary charges 19.
\n
Extraordinary surplus or loss 20.
\n
Tax on extraordinary surplus or loss 21.
\n
Other taxes not shown under the above items 22.
\n
Surplus or loss 23.
\n
Contribution to the Central Co-operative Fund 24.
\n
Provision to the Reserve Fund 25.
\n
Net surplus or loss 26.
\n
Provision to any reserve fund provided by statute 27.
\n
Provision for any purpose allowed by the Act or provided by statute 28.
\n
Dividend 29.
\n
Patronage refund 30.
\n
Bonus certificate or bonus share issue 31.
\n
Income and expenditure account balance for the accounting period CO-OPERATIVE SOCIETIES
\n
PART II - ACCOUNTING PRINCIPLES AND RULES
\n
Accounting principles 14. Items shown in the individual accounts shall be valued in accordance with the following general principles (a) the society must be presumed to be carrying on its business as a going concern; (b) the methods of valuation must be applied consistently from one accounting period to another; (c) valuation must be made on a prudent basis, and in particular: (i) only surplus realised at the balance sheet date may be included in the income and expenditure account, (ii) account shall be taken of all foreseeable liabilities and potential losses arising in the course of the accounting period concerned or of a previous one, even if such liabilities or losses become apparent only between the date of the balance sheet and the date on which it is drawn up, (iii) account must be taken of all depreciation whether the result of the accounting period is a loss or a surplus; (d) account must be taken of income and charges relating to the accounting period, irrespective of the date of receipt or payment of such income or charges; (e) the components of asset and liability items must be valued separately; (f) the opening balance sheet for each accounting period must correspond to the closing balance sheet for the preceding accounting period.
\n
Historical cost accounting rules 15. (1) Formation expenses shown as assets in the balance sheet shall be written off within a maximum period of five years.
\n
CO-OPERATIVE SOCIETIES
\n
(2)The amounts entered under \"Formation Expenses\" shall be explained in the notes to the accounts.
\n
16.(1) In the case of any fixed asset which has a limited useful economic life, the amount of (a) its purchase price or production cost; or (b) where it is estimated that any such asset will have a residual value at the end of the period of its useful economic life, its purchase price or production cost less that estimated residual value, shall be reduced by provisions for depreciation calculated to write off that amount systematically over the period of the asset’s useful economic life. Such provisions shall be charged in the income and expenditure account.
\n
(2)The purchase price of an asset shall be determined by adding to the actual price paid any expenses incidental to its acquisition.
\n
(3)The production cost of an asset shall be determined by adding to the purchase price of the raw materials and consumables used the amount of the costs incurred by the society which are directly attributable to the production of that asset.
\n
(4)In addition to the costs specified in sub-paragraph (3) of this paragraph there may be included in the production cost of an asset (a) a reasonable proportion of the costs incurred by the society which are only indirectly attributable to the production of that asset, but only to the extent that they relate to the period of production; and (b) interest on capital borrowed to finance the production of that asset, to the extent that it relates to the period of production. The inclusion of such interest and the amount thereof shall be disclosed in the notes to the accounts.
\n
(5)Fixed asset investments shall be accounted for in accordance with the following rules: (a) such investments shall be included in the society’s individual accounts by using the cost method; (b) the cost method referred to in sub-paragraph (a) is a method of accounting whereby the investment is recorded at cost. The income and expenditure account reflects income from the investment only to the extent that distributions are received or are receivable by the investor from accumulated net surplus of the investment arising subsequent to the date of acquisition;
\n
17.(1) Where a financial fixed asset has diminished in value, provision for diminution in value may be made in respect of it and the amount to be included in respect of it may be reduced accordingly. Any such provisions shall be charged in the profit and loss account and if not shown separately in the profit and loss account, shall be disclosed (either separately or in aggregate) in the notes to the accounts.
\n
(2)Provision for diminution in value shall be made in respect of any fixed asset which has diminished in value if the reduction in its value is expected to be permanent (whether its economic life is limited or not), and the amount to be included in respect of it shall be reduced accordingly. Any such provision shall be charged in the income and expenditure account and, if not shown separately in the income and expenditure account, shall be disclosed (either separately or in CO-OPERATIVE SOCIETIES aggregate) in the notes to the accounts.
\n
(3)Where the reasons for which any provision was made in accordance with sub-paragraph (1) or (2) have ceased to apply to any extent, that provision shall be written back to the extent that it is no longer necessary. Any amounts written back in accordance with this sub-paragraph which are not shown separately in the income and expenditure account shall be disclosed (either separately or in aggregate) in the notes to the accounts.
\n
18.(1) Notwithstanding that an item in respect of \"development costs\" is included under \"fixed assets\" in the balance sheet formats contained in this Schedule, an amount may only be included in a society’s balance sheet in respect of development costs in special circumstances.
\n
(2)If any amount is included in the society’s balance sheet in respect of development costs the following information shall be given in the notes to the accounts: (a) the period over which the amount of those costs originally capitalised is being or is to be written off; and (b) the reasons for capitalising the development costs in question.
\n
19.(1) Where goodwill is treated as an asset the following provisions of this paragraph shall apply.
\n
(2)Subject to sub-paragraphs (3) and (4), the amount of the consideration for any goodwill acquired by a society shall be reduced by provisions for amortisation calculated to write off that amount systematically over a period chosen by the committee of management of the society.
\n
(3)The period chosen shall not exceed the useful economic life of the goodwill in question.
\n
(4)In any case where any goodwill acquired by a society is shown or included as an asset in the society’s balance sheet the period chosen for writing off the consideration for that goodwill and the reasons for choosing that period shall be disclosed in the notes to the accounts.
\n
20.(1) Subject to the following paragraph, assets which fall to be included (a) amongst the fixed assets of a society under the item \"tangible assets\"; or (b) amongst the current assets of a society under the item \"raw materials and consumables\", may be included at a fixed quantity and value.
\n
(2)Sub-paragraph (1) applies to assets of a kind which are constantly being replaced, where (a) their overall value is not material to assessing the society’s state of affairs; and (b) their quantity, value and composition are not subject to material variation.
\n
21.(1) Subject to sub-paragraphs (2) and (3), the amount to be included in respect of any current asset shall, insofar as it is applicable, be its purchase price or production cost.
\n
CO-OPERATIVE SOCIETIES
\n
(2)If the net realisable value of any current asset is lower than its purchase price or production cost, the amount to be included in respect of that asset shall be the net realisable value.
\n
(3)Where the reasons for which any provision for diminution in value made in accordance with sub-paragraph (2) have ceased to apply to any extent, that provision shall be written back to the extent that it is no longer necessary.
\n
22.The method of determination of purchase price and the method of determination of production cost given in paragraph 16 of this Schedule shall apply for the purposes of paragraph 21 of this Schedule. Furthermore, distribution costs may not be included in production costs.
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23.(1) Subject to the qualification mentioned in sub-paragraph (3), the purchase price or production cost of (a) any assets which fall to be included under any item shown in a society’s balance sheet under the subheading \"stocks\"; and (b) any assets which are fungible assets (including investments), shall be determined by the application of one of the methods mentioned in subparagraph (2) in relation to any such assets of the same class.
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(2)The methods referred to in sub-paragraph (1) are (a) the method known as \"first in, first out\" (FIFO); (b) the weighted average price method; and (c) any other method similar to any of the methods mentioned above.
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(3)The method actually chosen for the purposes of this paragraph shall be the one which appears to the committee of management to be appropriate in the circumstances of the society.
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(4)Where in the case of any society (a) the purchase price or production cost of assets falling to be included under any item shown in the society’s balance sheet has been determined by the application of any method permitted by this paragraph; and (b) the amount shown in respect of that item differs materially from the relevant alternative amount given in sub-paragraph (5), the amount of that difference shall be disclosed in the notes to the accounts.
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(5)Subject to sub-paragraph (6), for the purposes of sub-paragraph (4)(b), the relevant alternative amount, in relation to any item shown in a society’s balance sheet, is the amount which would have been shown in respect of that item if assets of any class included under that item at an amount determined by any method permitted by this paragraph had instead been included at their replacement cost as at the balance sheet date.
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(6)The relevant alternative amount may be determined by reference to the most recent actual purchase price or production cost before the balance sheet date of assets of any class included under the item in question instead of by reference to their replacement cost as at that date, but only if the former appears to the committee of management of the society to constitute the more appropriate standard of comparison in the case of assets of that class.
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CO-OPERATIVE SOCIETIES
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(7)For the purpose of this paragraph, assets of any description shall be regarded as fungible if assets of that description are substantially indistinguishable one from another.
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24.(1) Where the amount repayable on any debt owed by a society is greater than the value of the consideration received in the transaction giving rise to the debt, the amount of the difference may be treated as an asset.
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(2)Where any amount as referred to in sub-paragraph (1) is treated as an asset (a) it shall be written off by reasonable amounts each year; (b) it shall be completely written off before repayment of the debt; and (c) if the current amount is not shown as a separate item in the society’s balance sheet it shall be disclosed in the notes to the accounts.
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25.(1) Provisions for liabilities and charges may not exceed in amount the sums which are reasonably necessary.
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(2)Particulars shall be given of each provision included in the item \"other provisions\" in the society’s balance sheet in any case where the amount of that provision is material.
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Alternative accounting rules 26. (1) Subject to paragraphs 28, 29 and 30 of this Schedule, the amounts to be included in respect of assets of any description mentioned in paragraph 27 of this Schedule shall be determined on any basis mentioned in that paragraph.
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(2)References in paragraphs 27 to 30 of this Schedule to \"the depreciation rules\" are to the rules embodied in paragraphs 16, 17, 18, 20, 21 and 24 of this Schedule.
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27.(1) Tangible fixed assets may be included at a market value determined as at the date of their last valuation.
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(2)Investments of any description falling to be included under either of the balance sheet formats contained in Part I of this Schedule may be included either (a) at a market value determined as at the date of their last valuation; or (b) at a value determined on any basis which appears to the committee of management to be appropriate in the circumstances of the society, but in the latter case particulars of the method of valuation, etc., adopted and of the reasons for adopting it shall be disclosed in the notes to the accounts.
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(3)Notwithstanding any other provision of this Schedule, investments in which investment companies have invested their funds shall be valued on the basis of their market value determined as at the balance sheet date.
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28.(1) Where the value of any asset of a society is determined on the basis mentioned in paragraph 27 of this Schedule that value shall be the starting point for determining the amount to be included in respect of that asset in the society’s individual accounts, instead of its purchase price or production cost or any value previously so determined for that asset; and the depreciation rules shall apply accordingly in relation to any such asset with the substitution for any reference to its purchase price or production cost by a reference to the value most recently CO-OPERATIVE SOCIETIES determined for that asset on any basis mentioned in paragraph 27 of this Schedule.
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(2)The amount of any provision for depreciation required in the case of any fixed asset as it applies by virtue of sub-paragraph (1) is referred to in sub-paragraph
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(3)as the adjusted amount, and the amount of any provision which would be required in respect of that asset according to the historical cost accounting rules is referred to as the historical cost amount.
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(3)Where sub-paragraph (1) applies in the case of any fixed asset, the amount of any provision for depreciation in respect of that asset (a) included in any item shown in the income and expenditure account in respect of amounts written off against the assets of the description in question; or (b) taken into account in stating any item so shown which is required by the explanatory notes in the income and expenditure account format contained in Part I of this Schedule to be stated after taking into account any necessary provisions for depreciation or diminution in the value of assets included under it, may be the historical cost amount instead of the adjusted amount, provided that the amount of any difference between the two is accounted for in the income and expenditure account and disclosed separately therein or in the notes to the accounts.
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29.(1) This paragraph applies where the amounts to be included in respect of assets covered by any items shown in a society’s individual accounts have been determined on any basis mentioned in paragraph 27 of this Schedule.
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(2)The items affected and the basis of a valuation adopted in determining the amounts of the assets in question in the case of each of such items shall be disclosed in the notes to the accounts.
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(3)In the case of each balance sheet item which is affected (a) the comparable amounts determined according to the historical cost accounting rules; or (b) the differences between those amounts and the corresponding amounts actually shown in the balance sheet in respect of that item, shall be shown separately in the balance sheet or in the notes to the accounts.
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(4)In sub-paragraph (3), references in relation to any item to the comparable amounts determined as mentioned thereto are references to (a) the aggregate amount which would be required to be shown in respect of that item if the amounts to be included in respect of all the assets covered by that item were determined according to the historical cost accounting rules; and (b) the aggregate amount of the cumulative provisions for depreciation or diminution in value which would be permitted or required in determining those amounts according to those rules.
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30.(1) With respect to any determination of the value of an asset of a society on any basis mentioned in paragraph 27 of this Schedule the amount of any surplus or loss arising from that determination shall be credited or, as the case may be, debited to a separate reserve to be called \"the revaluation reserve\", after allowing, where appropriate, for any provisions for depreciation or diminution in value made CO-OPERATIVE SOCIETIES otherwise than by reference to the value so determined and for any adjustments of any such provisions made in the light of that determination.
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(2)The amount of the revaluation reserve shall be shown in the society’s balance sheet under a separate subheading in the position given for the item \"revaluation reserve\" in Format 1 or 2 of the balance sheet formats contained in this Schedule, but need not be shown under that name.
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(3)The revaluation reserve shall be reduced to the extent that the amounts standing to the credit of the reserve are in the opinion of the committee of management of the society no longer necessary for the purpose of the accounting policies adopted by the society; but an amount may only be transferred from that reserve to the income and expenditure account if (a) the amount in question was previously charged to that account; or (b) it represents realised surplus.
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(4)Any amounts transferred from the revaluation reserve to the income and expenditure account in accordance with the provisions of sub-paragraph (3) shall be shown separately in the income and expenditure account.
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(5)Notwithstanding the provisions of sub-paragraph (3) the balance standing to the credit of the revaluation reserve may be capitalised in whole or in part at any time.
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(6)The treatment for taxation purpose of amounts credited or debited to the revaluation reserve shall be disclosed in the notes to the accounts.
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PART III - THE NOTES TO THE ACCOUNTS
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31.Any information required in the case of any society by the provisions of this paragraph shall, if not given in the balance sheet or the income and expenditure account, be given by way of the notes to the accounts. The information in respect of the following matters shall be provided as a minimum (a) The valuation methods applied to the various items in the individual accounts, and the methods employed in calculating the provisions for depreciation and diminution in value. For items included in the individual accounts which are or were originally expressed in foreign currency, the bases of translation used to express them in local currency shall be disclosed. (b) The number and the nominal value of the shares subscribed during the accounting period within the limits of the authorised capital. (c) The name, registered office and the type of each of the societies and/or partnerships, of which the society is a member, with unlimited liability; provided that this information may be omitted if it is not material. (d) Information in respect of each item which is or would but for paragraph 3(4)(b) of this Schedule be shown under the general item \"fixed assets\" in the society’s balance sheet, relating to (i) the amount of the purchase price or production cost, leaving out therefrom the depreciation or diminution in value in respect of that item, as at the date of the beginning of the accounting period and as at the balance sheet date respectively; (ii) the effect on any amount shown in the balance sheet in respect of that item of any revision of the amount in respect of any assets CO-OPERATIVE SOCIETIES included under that item made during that period, - acquisitions during that period of any assets, - disposals during that period of any assets, and - any transfers of assets of the society to and from that item during that period. (e) In respect of each item within indent (d) of this paragraph (i) the cumulative amount of provisions for depreciation or diminution in the value of assets included under that item as at each date mentioned in indent (d)(i) of this paragraph; (ii) the amount of any such provisions made in respect of the accounting period; (iii) the amount of any adjustments made in respect of any such provisions during the period in consequence of the disposal of any assets; and (iv) the amount of any other adjustments made in respect of any such provisions during the period. (f) The information required to be disclosed by virtue of indents (d) and (e) of this paragraph shall also be provided in the case of \"Formation
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Expenses\" where this item is shown separately from \"Fixed Assets\" in the balance sheet. (g) Amounts owed by the society and becoming due and payable after more than five years as well as the society’s entire debts covered by valuable security furnished by the society with an indication of the nature and form of the security. This information shall be disclosed separately for each creditor’s item, as provided for in the formats described in Part I of this Schedule. (h) The total amount of any financial commitments that are not included in the balance sheet, in so far as this information is of assistance in assessing the financial position. Any commitments concerning pensions and group undertakings shall be disclosed separately. (i) The turnover within the meaning of paragraph 8 of this Schedule, broken down by categories of activity and into geographical market in so far as, taking account of the manner in which the sale of products and the provision of services falling within the society’s ordinary activities are organised, these categories and markets differ substantially from one another. (j) The average number of persons employed during the accounting period, broken down by categories and, if they are not disclosed separately in the income and expenditure account, the staff costs relating to the accounting period broken down as otherwise required by Formats 2 and 4 of the income and expenditure account. (k) The difference between the tax charged for the accounting period and for earlier accounting periods and the amount of tax payable in respect of those periods, provided that this difference is material for purposes of future taxation. This amount may also be disclosed in the balance sheet as a cumulative amount under a separate item with an appropriate heading. (l) (i) The aggregate amount of the emoluments granted in respect of the accounting period to the members of the committee of management of a CO-OPERATIVE SOCIETIES society for their services as members of the committee of management of that society or for their services as members of the committee of management of any of its secondary, tertiary, subsidiary, or associated undertakings, while acting as directors/members of the committee of management of that undertaking; and (ii) The aggregate amount of any other emoluments granted in respect of the accounting period to the members of the committee of management of a society for their services in connection with the management of the affairs of the society or any of its secondary, tertiary,
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subsidiary, or associated undertakings, while acting as directors/ members of the committee of management of that undertaking; and shown separately from the aggregate amount of emoluments referred to in item (i) above; and (iii) The fact that the society has, during the accounting period, purchased or maintained a provision for any of its officers and, or, the auditor of such society, exempting them or indemnifying them, or any of them, as the case may be, against any liability which, by virtue of any law, would in the absence of such provision have been attached to them, as the case may be, in respect of any negligence, default or breach of duty, and the aggregate amount of premiums paid in respect thereof.
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In this indent, emoluments shall include the remuneration for the services of the members of the committee of management referred to herein and all fees, percentages, gifts, compensation for loss of office and other similar payments; as well as any commitments arising or entered into in respect of retirement pensions, superannuation allowances, gratuities or other similar commitments in favour of former members of the committee of management of the society referred to herein.
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The commitments arising or entered into in respect of retirement pensions, superannuation allowances, gratuities or other similar commitments in favour of former members of the committee of management of the society shall be shown separately from the other emoluments. (m) The amount of advances and credits granted to members of the committee of management of a society with indications of the interest rates, main conditions and any amounts repaid; as well as commitments entered into on their behalf by way of guarantees of any kind. The said commitments shall be shown separately. (n) The name and registered office of the undertaking which draws up the consolidated accounts of the largest body of undertakings of which the society forms part as a subsidiary undertaking. (o) The name and the registered office of the undertaking which draws up the consolidated accounts of the smallest body of undertakings of which the society forms part as a subsidiary undertaking; and (p) Where the parent companies referred to in indents (q) and (r) of this paragraph are not registered in Malta, the place where copies of the consolidated accounts referred to in these indents may be obtained, provided that they are available to the public.
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32.(1) If at the end of its accounting period, the society has one or more secondary, tertiary, subsidiary, or associated undertakings or participating interests CO-OPERATIVE SOCIETIES in other undertakings, the following information shall, where applicable, be given with respect to each such undertaking (a) the kind, name and registered or principal office of each undertaking; (b) in relation to the shares of each class of each undertaking held by the society, the identity of each class and the proportion of the nominal value of the issued shares of that class represented by the shares held as at the end of the undertaking’s relevant accounting period; and (c) the aggregate amount of the capital and reserves of each undertaking as at the end of its relevant accounting period, and its surplus or loss for that period.
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(2)For the purposes of sub-paragraph (1), the relevant accounting period is (a) if the accounting period of the undertaking ends with that of the society giving the information in its notes to the accounts, that accounting period; and (b) if not, the undertaking’s accounting period ending last before the end of the accounting period of the society giving that information.
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(3)The provisions of sub-paragraph (1) are subject to the exceptions and other provisions contained in paragraphs 33 and 34 of this Schedule.
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33.(1) Information otherwise required by paragraph 32(1) of this Schedule need not be given if it is not material.
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(2)References in this paragraph and in paragraph 32 of this Schedule to shares of undertakings shall include references to beneficial interests in undertakings where the capital of such undertakings is not divided into shares.
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34.(1) The information referred to in indent (l) of paragraph 31 and in paragraphs 32 and 33 of this Schedule may be omitted when it appears to the committee of management that their nature is such that they would be seriously prejudicial to any of the undertakings affected by these provisions and the Board agrees that the information need not be disclosed.
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(2)Where any information is omitted from the notes to the accounts by virtue of the provisions of sub-paragraph (1), that fact shall be disclosed in the notes to the accounts.
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35.(1) Particulars shall be given in the notes to the accounts of any charge on the assets of the society to secure the liabilities of any other person including, where practicable, the amount secured.
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(2)The following information shall be given with respect to any other contingent liability not provided for other than where the possibility of a loss is judged by the committee of management of the society to be remote (a) the amount or estimated amount of that liability; (b) its legal nature; and (c) whether any valuable security has been provided by the society in connection with that liability and, if so, what valuable security has been so provided.
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(3)There shall be stated, where practicable (a) the aggregate amount or estimated amount of contracts for capital expenditure, so far as not provided for; and CO-OPERATIVE SOCIETIES (b) the aggregate amount or estimated amount of capital expenditure authorised by the committee of management which has not been contracted for.
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(4)Commitments within any of the preceding sub-paragraphs of this paragraph undertaken on behalf of or for the benefit of a group undertaking shall be stated separately from the other commitments within that sub-paragraph.
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36.(1) Where any amount is transferred (a) to or from any reserves; or (b) to any provision for liabilities or charges; or (c) from any provision for liabilities and charges otherwise than for the purpose for which the provision was established, and the reserves or provisions are shown as separate items in the society’s balance sheet or in the notes to the accounts, the information mentioned in sub-paragraph (2) shall be given in respect of the aggregate of reserves or provisions included in the same item.
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(2)That information to which reference is made in sub-paragraph (1) is (a) the amount of the reserves or provisions as at the date of the beginning of the accounting period and as at the balance sheet date respectively; (b) any amounts transferred to or from the reserves or provisions during that period; and (c) the source and application respectively of any amounts so transferred.
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PART IV - TRANSITIONAL ARRANGEMENT
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37.(1) If, when individual accounts are drawn up in accordance with the provisions of this Schedule for the first time, the purchase price or production cost of a fixed asset cannot be determined without undue expense or delay, the net book amount at the beginning of the accounting period may be treated as the purchase price or production cost.
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(2)Any application of the provisions of sub-paragraph (1) shall be disclosed in the notes to the accounts.
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PART V - ABRIDGED FINANCIAL STATEMENTS - RULES AND FORMAT
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(1)Societies which, on their balance sheet date, do not exceed the limits of two of the three following criteria: - - balance sheet total: two million and five hundred and sixty-two thousand and three hundred and ten euro and seventy-four cents (2,562,310.74); turnover: five million and one hundred and twenty-four thousand and six hundred and twenty-one euro and forty-eight cents (5,124,621.48); average number of employees during the accounting period: fifty; shall in this Act be designated as small societies and may, for the purposes of this Act, draw up an abridged set of audited financial statements as specified in paragraphs (2) and (3) of this Part for public inspection.
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CO-OPERATIVE SOCIETIES
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(2)For the purposes of this Part, the word \"abridged\" (a) when used therein in relation to a balance sheet, shall mean an abbreviated version of the balance sheet, showing only those items to which a letter or Roman number is assigned in the balance sheet format shown under Part I of this Schedule, immediately following paragraph 13, under the heading \"Balance Sheet Format\"; but such version shall, in all other respects, correspond to the full balance sheet; (b) when used therein in relation to an income and expenditure account, shall mean the full income and expenditure account with the exception that items 1, 2, 3 and 6 in the income and expenditure format shown under Part I of this Schedule, immediately following paragraph 13, under the heading \"Income and Expenditure Format\", can be combined as one item under the heading \"gross surplus or loss\".
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(3)Societies referred to in paragraph (1) of this Part may draw up abridged notes to the accounts, omitting the disclosures prescribed by indents (g) to (l) of paragraph 31 of Part III of this Schedule. The notes to the accounts shall however disclose the information specified in indent (g) of the said paragraph 31 in total for all the items concerned.