NATIONAL TEACHERS COLLEGE

MANILA

A WRITTEN REPORT

IN PARTIAL FULFILLMENT

OF THE REQUIREMENTS

IN COOPERATIVE MANAGEMENT

BY

BALBON, SHANE NICOLE

MAGO, LARA MARIE

MARTIN, ZARINAH

SUBMITTED TO:

MR. BERNARD EVAN V. JAMON

FEBRUARY 28, 2020

GRADING SHEET

Class Schedule: Tue/Fri 10:00AM-11:30AM

School: NATIONAL TEACHERS COLLEGE

Subject: COOPERATIVE MANAGEMENT

Topic: Management and Supervision of a Cooperative

a.) Powers and Functions of Officers

Powers and Capacities of a registered Cooperative

Responsibilities, rights, and privileges of a Cooperative under Republic act No. 9520

School Year: 2ND Semester, AY 2020

NameLN, FN MN

Student Number

Contact Number

Delivery(25%)

Posture(20%)

Content(35%)

Q & A (Knowledge on

the Topic)(20%)

Total(100%)

Remarks

Balbon, Shane Nicole

61901686 09564605873

Mago, Lara Marie 61901871 09287233659Martin, Zarinah Mae P.

61901860 09367131961

I. Introduction

This Written Report is about the Organization and Management of the Cooperatives but we the

Reporters will focused only on the following; (1) Management and Supervision of a Cooperative;

(2) Power and Capacities of a registered Cooperatives and; (3) The Responsibilities, Rights,

and Privileges of a Cooperative under Republic Act No. 9520. The Purpose of attaining all of the

objectives stated in RA No. 9520 is to exercise any other power which a natural person could do

and exercise and which now or hereafter may be authorized by the law. The Reporters will

discuss about the Republic Act No. 9520 that is known as the Philippine Cooperative Code of

2008. The RA No.9520 consist of 22 Sections, 19 Chapters, and 149 Articles but the main focus

will be from Section 5 Articles 51 to 62 of Chapter 22 the Responsibilities, rights, and privileges

of a Cooperative. In this Chapter of RA No. 9520, the Reporters will discuss the responsibilities

that the Cooperative must do. Some of these responsibilities are registering their official postal

address and keeping some of their documents open to its members and to the Authority for the

inspection. Also, the rights of the Cooperatives will be discussed such as the Tax treatment of

Cooperative. Lastly, the Privileges of Cooperative will also be discussed.

II. BODY

Management and Supervision of cooperatives

In the Management and supervision of cooperatives, we will differentiate first what is principles

and practices. Principles, It is more on based on truth and facts regardless of any

circumstances. It is also diverse from own conviction while the practices is the action or process

of doing something. It is the application of principles and it follows the natural flow. Now we will

define the democracy. Democracy is flowing in the cooperatives. Democracy, it is where the

people has the right to vote for the leaders that they want to lead them. It is where everyone is

treated equally. Democracy came from the word demos means the person and kratia means

power or rule. It is stated here that the cooperative administration and supervision, democratic

administration and supervision is not the same. The cooperative administration and supervision

and the democratic administration and supervision seems closely related but no because the

cooperative administration and supervision is more inclined on the aspect and importance of

cooperative effort in administrating and supervising a school efficiently and effectively. There is

a Barr and burton in which it is the responsibility, realization of classroom problems, recognition

of contribution of instruction. It is all about doing your responsibility and effort in a specific task.

Cooperative administration and supervision has Voluntary and open participation in which

anyone in the cooperative regardless of the gender has the right to participate. Next, there is

democratic member control in which there is an equal treatment in terms of voting the leaders

and planning the rights in decision making and transactions. Each of the member has the right

to have a proper education and training given by the cooperatives and lastly, cooperation

among cooperative administration in which it is the cooperative movement by working together

through local, national, regional and international structures. There is this Republic act No. 6713

known as the code of ethics for professional teachers. It is stated here the things that will help

each member of cooperative to be more knowledgeable and skilled. It also stated here the mass

growth and development. Also, the observation of professional code for ethics.

POWERS AND FUNCTIONS OF OFFICERS

In cooperative, their is an officers who help to manage the cooperatives and each of them

has the power and different functions and duties to perform. One of the cooperatives officers is

called Board of directors. The board of directors are the responsible in formulating a strategic

development plan for the cooperatives. Next to BOD is the Chairperson in which its duties is to

set a meetings in coordination of other members of the board of directors. Vice Chairperson is

next to chairperson. Its duties is to perform all the duties of the chairperson in the absence of

the latter. Treasurer is also one of the officer of cooperative. Their duties is to keep and maintain

the records of cash transactions of the cooperative. Secretary are the responsible for the update

registry of the members. They are also responsible to keep an extra copy of the treasurers

report and other report. Audit committee are the ones responsible to audit the performance of

the cooperative while the election committee are responsible for the canvas and certify result of

the election. They are also the ones who implements rules and guidelines that is approved by

the general assembly. Mediation and conciliation committee are the one who accept and file

evaluation reports while the Ethics committee are the one who recommend ethical rules and

policy to the board of directors. Lastly, the General manager are the responsible to provide and

submit the monthly status report of the cooperatives to the board of directors.

POWER AND CAPACITIES OF A REGISTERED COOPERATIVE

The Cooperative has a power and capacities just like the other forms of business. One of

the power of the cooperative is to use it's registered name exclusively. Second, the cooperative

has the capacity to succeed in the business industry since we all know that the cooperative was

formed by the shared interest of the people that's why it will likely to succeed. They also have

the power to improve its own article of cooperation according to the cooperation code of the

Philippines or the Republic act No. 9520. The cooperatives has the capacity to adopt laws that

is according to this code. They have the power to purchase, take, grant and receive and deal

with such personal property transaction of law affairs of the cooperative but they should be

responsible for the limitations that the law and constitution prescribed. Also, to enter in a division

or merger of a cooperative. The cooperative has the power to form a subsidiary cooperation and

power to join in any federation as a union. Cooperatives are entitled to avail loans or to receive

grants from the financial assistance from foreign and domestic sources. It is also the power and

capacity of the cooperative to have a preferential rights and privileges that is stated in the

Republic act No. 9520 which can be found in section 5 articles 51 to 62 of Chapter 5. In the

cooperative code of the Philippines, it is stated that the cooperatives has the right to operate in

educational institutions such as school and it is considered as one of their capacities. Lastly, the

cooperatives has the power to exercise their powers that the cooperative code of the Philippines

granted to them.

RESPONSIBILITIES, RIGHTS, AND PRIVILEGES OF A COOPERATIVE UNDER REPUBLIC

ACT 9520.

Republic Act No. 9520

It is an act amending the Cooperative code of the Philippines to be known as "Philippine

Cooperative Code of 2008". This Cooperative code of the Philippines is a declared policy of the

state to help the Cooperatives to grow and develop their Business. This will help the people

under Cooperatives to be knowledgeable and to enhance their skills to help Cooperatives to

attain Economic development and social justice and to have also a basic knowledge on how to

operate and organize a Cooperative. The RA No. 9520 has 19 Chapter started from Chapter 1

which is about General Concept and Principles and ended in Chapter 19 The Final Provision.

Each Chapter in RA No. 9520 has Sections and Articles. These laws consist of 22 sections and

149 Articles about the Cooperatives but we will focus on Section 5 Articles 51 to 62 of Chapter 5

which will be about Responsibilities, rights, and privileges of a cooperative.

Section 5 Article 51 of Chapter 5

Article 51: Address. It is where all the Cooperatives must have their official postal address

to be registered with the Authority. It is for the continuous communication of the Cooperatives

and Authority. Also, for the notices and mails that will be sent to the Cooperative. If the

Cooperative changes their postal address or they change their place from another place, the

Cooperatives must register it again with the Authority.

Section 5 Article 52 of Chapter 5

Article 52: Books to be kept open. The following documents must kept open by the

Cooperatives to be ready and accessible for its members and Authority. We already discussed

before that Lack of Secrecy is one of the disadvantage of Cooperative because of the

documents are open to its members. But in Section 5 Article 52 the following documents must

kept open for the inspection of the representatives of the Authority. The following documents

are:

(a) A copy of this code and all other laws pertaining to cooperatives:

(b) A copy of the Regulations of the Authority;

(c) A copy of the Articles of cooperation and bylaws of the cooperative;

(d) A register of Members;

(e) The books of the minutes of the meetings of the general assembly, board of directors and

committee;

(f) Share books, where applicable;

(g) Financial statement and;

(h) Such other documents as may be prescribed by the laws or the bylaws.

In Article 52 it is stated that the Accountant or the Bookkeeper are the one whose

responsible for the maintenance of the books and records of account of the Cooperatives while

the Audit Committee are the responsible for the continuous and periodic review of the books. It

is also stated that the both of them must be responsible for the time of audit and inspection. The

Cooperatives must have the annual Financial Statement that should be posted in a place where

people are easily get attracted in the principal office of Cooperative. They should keep and

maintain their records correct and true because the financial statement must be accurate and

should be based on the operation of the Cooperative itself. It must be accurate because it will

serve as an evidence on how the business going through. This Article also stated that the

Cooperatives have the right to dispose or to completely destroy the documents whether it's

financial or non-financial documents that will exceed more than five (5) years. But before they

dispose those documents, the documents should be certified first by the board secretary and

chairman of the audit committee before they will send it to the board of directors for the approval

of disposing the documents.

Section 5 Article 53 of Chapter 5

Article 53: Reports. Every Cooperative should have a regular report about the program of

the activities implemented inside the cooperatives. The report should include the progress and

achievements of the activities of the Cooperatives at the end of every fiscal year. Each and

every members of the Cooperative should have their copy of the report and it should be

accessible to all the members but then the Cooperatives must file the report of the program of

activities to the Authority within one hundred twenty (120) days starting from the end of the

calendar year. If the Cooperatives failed to file the report within the said days, the Authority will

file the representative officer or the accountable officer/s a fees and penalties that prescribed by

the Authority. The Cooperatives must be aware of filing the report to the Authority for them to

prevent from facing fees and penalties. Before filing the report to the Authority, the Cooperatives

must check first if the forms and content of their report is following the prescribed rules given by

the Authority. It is important to include to the report all the needed information that the code

required. If the Cooperative failed to file the report or failed to include the required information,

the Authority should gave them a written notice fifteen (15) days before the one hundred twenty

days of filing expires. This notice states its non-compliance and the fees and penalties that will

be imposed to the Cooperative.

Section 5 Article 54 of Chapter 5

Article 54: Register of Members as a Prima Facie Evidence. In every registered

Cooperative they must have the list of their members as evidence in which this list should

include the date where the Cooperatives registered this person as a member and also the date

when this registered person stopped to be a member. It would be a Prima Facie Evidence or

should I say enough evidence for the Cooperative to be kept.

Section 5 Article 55 of Chapter 5

Article 55: Probative Value of Certified Copies of Entries. A Copy of any entry of any book

that is register and list regularly by the cooperative shall certified properly according to the rules

of evidence which should be allowed as the evidence of existence or prima facie evidence of the

transactions therein recorded. It is stated here that book of entries consisting the financial

standing of the cooperative should be kept in the business place. No one can keep it private

because it is the legal basis of entries and transaction of the business, unless by order of a

competent court.

Section 5 Article 56 of Chapter 5

Article 56: Bonding of Accountable Officers. In article 56, It is stated that the Cooperative

personnel such as the directors, officer or the respective person who handles the funds, securities and

the property of the Cooperative should covered by surety bond. This bond shows the Faithful

performance of the Cooperative to their appointed duties and obligations. The surety bond is issued by

the registered by the insurance or bonding company. This surety bond monitors the performance of the

cooperatives from time to time. The board of directors are responsible to check if the said bond is

accurate and acceptable. The Authority requiring the bonds of the accountable officer or the respective

officer on the day when the Cooperative registered to the authority. This said bonds should be renewed

annually and the cooperatives should always inform the authority about the renewal of these bonds.

Section 5 Article 57 of Chapter 5

Article 57: Preference of Claims. In this article, it is stated that when a cooperative have any

debt due to its members and when the members has a total amount of loan or credit that cooperative

grant to them, the Cooperative shall establish or constitute a first lien on any raw materials, tangible

goods and services acquired as long as it is same and not fully paid. It is also stated that the property

that is under the lien paragraph can't be sold or transact with the third parties without the permission of

the cooperative. The lien on the said property should continue to exist even if the sale or transaction is

done thereof until that lien has been end in proper way. If there is a violation of the paragraph on any

sale or transaction, it should be void.

Section 5 Article 58 of Chapter 5

Article 58: Instrument of Salary or Wage Destruction. In this article, it is stated that the

member of a cooperative can execute an instrument to deduct his salary, leave credits and

other monetary benefits for the satisfaction of his debt or other demand to the cooperatives. The

cooperative only authorized the employer to perform this instrument of deduction. It is stated

that on the execution of such instrument, the cooperative requires the employer to make or to

do a deduction according to the agreement and remit of the amount without delay. Deduction

should perform after ten (10) days of the end of the cooperatives payroll month but the employer

can perform the deduction if the employee have remaining debt unpaid. This should be contain

in the written request of the employer. It is also stated that the member who agreed to carry out

the terms of the said instrument that under their employer should include all the private firms

and national and local government by the employer. This article should be apply and prior to

execute the approval of this Cooperative code in the said deduction agreement. According to

the existing laws, the employers responsibility should be mandatory and in the case of private

employer, they should collect the actual and reasonable cost deducting and remitting.

Section 5 Article 59 of Chapter 5

Article 59: Primary Lien. It is stated in this Article that the Cooperatives should have a

legal charge or primary lien to the capitals, deposits, and interest of those members who have

debt in the Cooperatives. It just means that the cooperative has the right to charge the member

if it has debt due to the cooperative.

Section 5 Article 60 of Chapter 5

Article 60: Tax Treatment of Cooperatives. This Article stated that the registered

Cooperatives under the Cooperative code of the Philippines that doesn't have any transaction

with non-members or people and business outside the Cooperatives shall not be subjected to

any taxes and other fees that the Internal Revenue and other tax law implemented. The

succeeding section should handle the Cooperatives that are not under this Article.

Section 5 Article 61 of Chapter 5

Article 61: Tax and Other Exemptions. In this article, It is stated that the business

transaction of the cooperatives to its members and members to cooperatives shall not be

subjected to any taxes and fees. The cooperatives have the following tax exemption if they deal

or transact with non members.

First, if the cooperatives have an undivided net savings with more than 10 Million

(10,000,000.00) shall be exempted in any taxes and in custom duties such as importing a

certified materials, machineries, and spare parts by DTI used by the cooperative that doesn't

available in the local market. The free tax from importation should not benefit to the ownership

but it can be transferred to any individual until after five (5) years, if the tax free is not used

within the said years by the cooperative or the transferee they are liable to pay twice of the

amount of the imposed tax or duties. The cooperatives that has 10 Million undivided net savings

should be exempted in the following tax at full rate:

(a) Income tax - It is stated here that the interest receives by the member should not charge the

same tax . In addition, the Cooperatives are exempted in income tax regardless of it's

classification from the date where the Cooperatives registered with the authority

(b) Value added tax on transaction with non members - The cooperatives registered with the

authority shall exempt from the value added tax according to Republic act No. 9337 known as

the National Internal Revenue code under the section 109, subsections L, M and N. It is stated

that under the section 109 subsection L that the cooperatives shall include the sale of the

production of raw materials into finished product and the sale of process products to its

members and non members that organized and operate by the members. Any process porduct

and finished goods that produce by the members should be name and account to the

Cooperative when it is sold. Lastly, the cooperative should return the 25% of the net income to

the members as an interest.

(c) all other taxes unless otherwise provided

(d) The tax of the operation of the Cooperative on a certain area like donation to charities,

educational and research institution or reinvestment to socioeconomic projects are deducted.

If the Cooperatives have an undivided net sales without any accumulated amount, it

should be exempted in any payment of local taxes and taxes on transactions with the bank and

insurance companies. When the non members of cooperatives rendered a sales or services,

they should pay the percentage tax sale that is made for producers or marketing cooperatives.

Nothing in this article is stated to prevent the Authority to examine all the books of account and

accounting records of the cooperative. It should be examine by the authorize internal revenue

officers for the internal revenue tax purpose only and it should be done after the authorization of

the authority.

Not exceeding of five hundred thousand pesos (P500,000.00), Any group of people

whose requiring for the acknowledgement of articles of cooperation and instruments of loan

from cooperatives can render without any charge but this will be available only on the areas

where there is no notary public and judge that can exercise the ex officio of a notary public.

It is stated that the instrument of loan that is under this code which doe not exceed in two

hundred fifty thousand pesos (P250,000.00) and the title of documents and the documents

connected to the operation of the cooperative or any documents that is related to the faithful

performance of duties and obligations of the accountable officer should be exempted and free at

charge in any register of deeds.

It is stated that the cooperatives should be exempted in any payment for the all court and

sheriff's fee, this payment shall be payable to the Philippine government to used for the actions

that is connected and stated in this code. This action brought first by the authority before the

court to execute a payment obligations that is contracted in favor of the cooperative.

All Cooperatives shall be exempt from putting up a bond for bringing an appeal against

the decision of an inferior court or for seeking to set aside any third party claim: Provided, that a

certification of the authority showing that the assets of the cooperative are in excess of the

amount of the bond required by the court in similar cases shall be accepted by the court as a

sufficient bond.

Any security that the cooperatives issued should be exempt from the provision of

securities act provided such security shall not be speculative.

Section 5 Article 62 of Chapter 5

Article 62: Privileges of Cooperatives. Cooperatives under this code has the following

privileges;

(1) Cooperatives has the privilege to keep their sealed cash boxes and any other important

documents to the safes of municipal or to the city treasurer and government without any fee

charges to them.

(2) The Cooperatives that is organized among government employees has the privilege to use

the available space in the government agency whether it is owned or rented.

(3) One of the Privilege of a Cooperative that renders a special service like ice plant, electricity

and transportation has the privilege to secure a franchise and should open the membership to

those person who are qualified in the areas of the operation of the cooperatives.

(4) It is a privilege to a Cooperative in a appropriate areas to be the concerned cooperatives for

the supply of agricultural products and commodities to the Government and other agency.

(5) It is one of their privilege that the responsible government agencies shall give them a special

treatment in allocating such agricultural inputs and implements. Also, in rice distribution.

(6) In terms of allocation in commercial shipping vessels for the shipment of the products and

goods, that Cooperative has granted a equal treatment.

(7) The cooperatives and their federation which main goal or purpose is the production and

marketing of agricultural products has given the right to manage a public market or public

utilities but these rights should do exclusively by the cooperatives and if the cooperative has an

arrangement in other non cooperatives parties, they can't utilize these rights.

(8) a credit cooperative or a federations engaged in credit has the privilege to loan credit lines,

to rediscount their loan notes and other eligible papers through the development bank of the

Philippines and any other financial institutions except to the Bangko sentral ng Pilipinas (BSP).

The Philippine deposit insurance corporation (PDIC) and other government financial institution

should give a the cooperatives or the federation that engaged with credit a technical assistance.

It is to help the cooperatives or the federation to establish and strengthen their own cooperative

deposit insurance system.

(9)The Cooperative that is engaged in transportation service has entitled to have a financial

support for the maintainace and spare parts of transport whether it is by land or by sea through

the financial program of the government. they can manage and operate on the public ports and

terminals and can operate a franchise of an active potential routes for the transportation.

(10) without being prevented by the Republic act no. 9184 or known as the government

procurement act, the cooperatives transacting they shall exempt in the prequalification bidding

requirement.

(11) The cooperatives has the privilege to be represented without any charge by the provincial

or city fiscal except when the Republic of the Philippine is not favor in it.

(12) The cooperatives that is organized by the group of people under the educational institution

has the privilege to operate or to manage a service related activity to the educational institution

that they are belong to. Example of it is the Cooperatives in a school in which they are selling

goods and products inside the school canteen.

(13) The housing agencies and government financial institution should have a special window

for the cooperatives for the financing of the housing projects that the cooperatives performing.

The cooperatives should receive the same or equal interest rate and term from the other

socialize housing project. The financing of the cooperatives should be in a blanket loan or

blanket mortgage to qualified the cooperatives without any hassle of processing individually.

The Authority should implement a rules and regulations about the housing cooperatives but the

should consult it first to the government agencies or other sectors concerning the housing

cooperatives.

III. Conclusion

To sum up the Report, the Cooperatives has the power granted by the code to be

exercise. People in cooperatives has the proper way to manage and supervise the business.

Not just the Cooperative but also the members has the power to manage the business and each

officers of the Cooperatives has their own function and responsibilities. Cooperatives has the

power and capacity to avail loans from foreign and domestic sources. This power and capacity

can help the members of the Cooperative to improve their individual status. The Cooperatives

has a lot of responsibilities to take but it is natural to a business to have a different kinds of

responsibilities. Though, the Cooperatives has seen to be a lot of responsibilities, it also has a

rights which is stated in the Republic Act No. 9520. This rights help the Cooperative to operate

smoothly. The Privileges of the Cooperative helps the business to have advantages that will

help the Cooperative itself to grow and develop the business to attain the Economic goals and

development of the said Cooperative.

Q&A Activity

Instruction

The Reporters will ask question and students must choose between the two choices that will be

given by the Reporters. The right number will they get will be their score for the activity. The

activity consist of ten questions only and It should be written in 1/4 sheet of paper. The student

should write the exact letter and answer for the question given.

Questions

1.) One of the power and capacity of Cooperative is to avail ____, be entitled to credit and to

accept and receive grants, donations and assistance from foreign and domestic sources.

a. Preferential Rights

b. Loans

2.) It is the power and capacity of Cooperative to avail of preferential rights granted to

Cooperatives under this Republic Act No.

a. RA No. 7160

b. RA No. 7610

3.) It is the responsibility of the Cooperatives to register their official _____ with the Authority

according to the section 5 article 51 of chapter 5.

a. Postal Address

b. Postal Number

4.) They are the ones who provide the general policy direction.

a. Chairperson

b. Board of Directors

5.) They keep an update and complete registry of all members.

a. Treasurer

b. Secretary

6.) They perform such other duties as may be delegated to him/her by the Board of Directors.

a. Chairperson

b. Vice Chairperson

7.) It is known as the Philippine Cooperative Code of 2008.

a. Republic act 9520

b. Republic act 9250

8.) Section 5 Article 60 of Chapter 5 is about?

a. Tax treatment of Cooperative

b. Tax and other Exemptions

9.) They are the responsible for the continuous and periodic review of the books and records of

account.

a. Bookkeeper

b. Audit Committee

10.) The Amount allocated for interest on Capitals.

a. Income Tax

b. Value-Added Tax

Answers:

1.) B. Loans 6.) B. Vice Chairperson

2.) A. RA No. 7160 7.) A. Republic Act 9520

3.) A. Postal Address 8.) A. Tax treatment of Cooperative

4.) B. Board of Directors 9.) B. Audit Committee

5.) B. Secretary 10.) A. Income Tax

REFERENCE(S) & SLIDES

2

https://www.cda.gov.ph/resources/issuances/philippine-cooperative-code-of-2008/

republic-act-9520

https://www.cda.gov.ph/images/Downloads/Other-Information/basic%20info%20on

%20coops.pdf?

fbclid=IwAR0qz_zGzlC1GkNDvZT6j6Eno5LEGbsZorlMEcWdBDFvjGJuLHz6UTwPA6o

https://www.slideshare.net/IssaGo/functions-and-responsibilities-of-the-officers-of-the-

cooperative?fbclid=IwAR0Jl9UNqES40BrmwfIieBg1IpyBkLPiLmtzzOcM-

BIqL0ew1bNdZs_pPQs

https://www.slideshare.net/mobile/MireaMizushima1/cooperative-administration-and-

supervision-principles-and-practices