Co-operative Society – Benefit of Co-operation Union, Accounts

CO-OPERATIVE SOCIETY – BENEFIT OF CO-OPERATION UNION, ACCOUNTS

Co-operation is as old as human society. From time immemorial, man had relied on the existence of his fellows for existence and examples of C0-operative. Modern co-operative is however associated with the successful experiment of 28 weavers from Rochdale, England who in 1844 established the first successful co-operative consumers society.

Their success became widely acclaimed and their working principles were accepted as the basic principles of co-operative organization.

Earlier attempts to form co-operative failed because members were illiterate, dishonest and accounts were not kept. Following the Rochdale principles, enabled the co-operative movement to avoid most of the evils of the era of industrial expansion.

Again, because the majority of the composition of membership had been people of low income, their contributions in the form of shares and thrift savings, special saving and other sources of income had been very low. The view of this coupled with the de-emphasis of capital in the society i.e. the instituted low return on capital, the wealthy men with capital have technically been scared away.

Lastly, the system of accounting usually adopted by these bodies gives no room for proper management. This is because information is hardly extracted from such records kept by them for planning and controlling of their operation. I therefore wish to derive into the functions and functioning of the co-operative movement with particular emphasis on the accounting aspects of its management and then recommend on the practical and attainable application of its principles to ensure the achievements of the goal of the movement.

 

BACKGROUND OF THE STUDY:

Man had relied on the existence of his fellows for existence and examples of working together. Man made an attempt to form a co-operative but they failed due to because members were illiterate and an account were not kept.

Growth is a gradual process, co-operative also is a gradual process. Co-operatives as a gradual process of growth has succeeded in developed countries but this has not been the case in developing countries.

It appears that this process of co-operative has not been clear to developing countries and this has resulted in their inability to develop like industrialized nations.

The system of accounting usually adopted by the management is because information is hardly extracted from such records kept by planning and controlling of the operation. The majority of the composition of members had been people of low income.

 

LITERATURE REVIEW:

There have been diverse theories and opinions about accountability as instrument for restructuring and resuscitating of an economy or a sector of economy. Many of these theories and opinions have been expressed by different writers in different books, journals, newspapers and seminars. The researcher therefore has deemed it pertinent to review some of these theories and opinions with a view to identifying the logic behind them. It is intended also to provide the reader with all the necessary ideas on accountability which will help him to draw a reasonable conclusion based on the findings of the research.

During the regime of the second republic in this country, one common instrument of campaign of one political party against one another is usually in the form of “this administration is a mess of the whole thing it is an embodiment of planlessness and squandermania; and therefore we need a change”. That is in fact one of the major reasons why the 1983 general campaign (that ushered in) preparatory for the same 1983 general election was full of “change ‘83”. This is because there was in the main planlessness and squandermania, made possible mainly due to improper accountability. During this period in time, the country’s economy was in shambles, simply because there was a gap in the whole system that is problem that regards improper accountability and/or a poor use of the accounting information to make reasonable plans for the future. It is equally worthy to mention here that there is as much inherent problem and difficulty in management wealth as is in management debt or poverty. This therefore implies that proper management is indispensable at any time, and in any sector of the economy if that sector is to be fully sustained. The employment of proper management techniques involves proper accountability (accounts), and the making of reasonable plans for the future.

Ekwonu (1985) made the following assertion. Accountants both in the public and private sectors naturally were equally misled. They felt so assured and relaxed as virtually all facets of the economy enjoyed what has since been described as the “oil boom”.

On the role of the accountant or any person preparing accounts in the present bid to restructure and strengthen the economy, Ekwonu has thus to say Ekwonu (1985 “as earlier indicated, during the oil boom, the major accounting concepts of profit and cashing planning).

The practice of accounting in today’s Nigeria economy, paper delivered by Mr. E. C. Ekwonu at ASP Oko 18th May, 1985.

Cost control, and cost reduction were woefully neglected by the production and government accountants. These should be vigorously re-introduced and strengthened.

On the reliance and proper use of the accounting information by the top management in making reasonable projections for the future, Ekwonu offered the following “Ekwonu (1985)”. The Nigerian accountants has the rather unenviable task of initiating moves in, and building up necessary cost estimates. He should participate in the search for alternative uses of locally, available raw materials as well as in improved method of manufacture aimed at enhancing the quality of the products and reducing units selling prices. He is required to produce for top management cost studies, cash flow and profit projections based on improved methods of production as well as on the use of locally produced raw materials as the basis of management decisions.

Rule 8 of the Eastern Nigeria Co-operative Societies Law and Rules (Chapter 28 of Revised Laws of Eastern Nigeria 1963), states that “every registered co-operative society shall keep such accounts and shall use such books as may from time to time be prescribed by the registrar”. Rule 35(1) prescribes that the committee of every registered society shall prepare or Rule 8, 44 and 35 of the Eastern Nigeria co-operative societies law and rules or cause to be prepared yearly in such form as may be prescribed by the registrar:

(a) An account of the registered society’s trading operations for the year.

(b) An income and expenditure account.

(c) A balance sheet and

(d) Such statistical information as the registrar may require.

Rule 44(2) enumerating the duties of the secretary, stipulates that “the secretary should record the whole of the transactions of the registered society in the books prescribed for that purpose to a conduct correspondence on behalf of the registered society.

We have seen from the above that the registrar has such powers to prescribe the books to be used by different type of co-operatives (as we shall see below), and Rule 35(1) prescribes that the committee shall prepare the annual accounts and then financial statements, while Rule 44(2) specifically attributed this task to the secretary.

No doubt, the secretary whose duty is to keep these books and to prepare the annual accounts from the records has to be well grounded in at least the simple book keeping. But what is obtainable in most of our co-operative societies is that the secretaries cannot keep most of these books. The co-operative inspector whose duties as prescribed by the law as inspecting, auditing and supervising (as we shall see below) has most often found himself in trouble while inspecting or auditing or supervising the societies concerned, because none of the books mentioned has been put into use or only some are in use, or further still the books have been misled up with wrong entries. The secretary is not all to blame because he definitely cannot carry out the work he does not know about. One of the duties of the co-operative inspector is of course to train the secretary most often these secretaries don’t grasp the techniques until after a long time.

The duties of the co-operative inspector as specified by section 40 of the law include the auditing, supervision and inspection of co-operative societies. Okonkwo has this to say about the duties of co-operative inspector. “A co-operative society is a business organization or venture. The main task of the co-operative inspector is go guide the owners of the business, that is the members of the co-operative society, to conduct their business efficiently and profitably. The co-operative inspector owes some duties to the members of the co-operative society. He is expected to educate them on the meaning and functioning of a co-operative society, the conduct of society’s meetings, the co-operative law and the society’s byelaws, and many more other facts of knowledge required for the effective running of the society”. Generally, the duties, of a co-operative inspector range from promotional duties, education duties, inspection duties to advisory duties.

One principal thing crystal clear from the above analysis is that it is the duty of the secretary or the committee member to keep the books of the account of the society, and also to prepare the annual financial statements. The inspector is there to offer professional or expert advice to ensure the proper running of the society.

Okonkwo J. N. P. said “the ideal thing is for secretaries of co-operative societies to prepare the societies annual accounts. Infact, it is stipulated in the co-operative law that the preparation of the society’s annual account is the responsibility of the committee. The actual situation is that often times, the secretary and the committee are unable to prepare the annual accounts. It then devolves on co-operative inspectors to prepare the annual accounts by themselves”.

We have seen from the fore-going work what the co-operative is and what it is supposed to be in the general/widest sense, and also its constraints in the particular/Nigerian contest. We also have been able to see from the review of the related literature that for any business organisation to stand firmly on its own, it would basically, require finance which is itself very important. Then because of the versatile nature of finance, it requires a very serious attention from an expert in its management. Again having seen from both the definition and the workings of the co-operative, that it is a business organisation, it is subject in every material aspect to the ordeals of financial management. And, again, having seen all the qualities expected of a finance officer in any organisation, our co-operatives thereby stand wanting in the quality of their officers doing the work of the finance officers.

Hence, with due difference to all the authorities quoted above, coupled with the practical experience about the workings and operations of these co-operatives; we hereby institute a call for the review of the length of or the duration of training being given to the present co-operative. Inspectors in training to allow for the inclusion in their curriculum such relevant courses that will enable them be fully equipped for their work. Also to be included in this programme is the free training of the officers of various co-operative societies on the relevant subjects/courses to enable them carry out such duties that will project the image of their societies economically; or the recruitment of more people to be trained as co-operative inspectors who should be posted each to a co-operative society to manage its activities in accordance to the knowledge gained. These recommendation even though are to be costly, are still appropriate since co-operative is in the Nigeria Context instrument of development. It should be government sponsored as it is at present. The call is only on the improved quality and amount of the sponsorship. Before 2979, co-operative inspectors were given motor cycle allowances and grants to enable them carryout their work effectively, but such are no longer in the scheme of the sponsorship today.

One may be tempted to ask such a question as what do co-operatives manage, since they don’t have money? Yes, what is very clear about co-operative in Nigeria is that they don’t have enough capital to compete favourably with other categories of business organizations. This is effect is caused mainly by the strict observance and application of its limited interest” on capital which has technically scared away rich investors from investing in co-operatives. As earlier observed in the introduction that one of the reasons for the rejection of the co-operatives in the different sectors of our economy is because it is anti-capitalistic in design and anti-materialistic in operation. This therefore runs counters to the belief of Nigerians because we are both capitalistic and materialistic people. So far as co-operative movement observes these two principles of “Limited interest” on Capital and “equitable distribution of surplus” (which is in effect have given capital its place in the movement) among others, it is called its capitalistic movement that is to say that the anti-capitalism of the co-operative movement is clearly defined in two principles.

The government alone cannot continue indefinitely in the granting of loans and other subventions. What the government does in any circumstances is to set the ball rolling by providing a conducive atmosphere for the proper functioning of such programmes. The government in this case can decree that equality of every member (one man one vote) still prevails while capital is appropriately rewarded as in the other sectors of the economy. This is necessary because of the Nigerian attitude to money, and its remuneration.

Perhaps, a little review of the performance of co-operative societies in some parts of Nigeria will give us the general insight of what co-operatives have been able to do since about 56 years of its introduction in Nigeria ie (1935 – 1991)

King (1975) analysed the co-operative societies performance in the Northern Nigeria. He posited that the co-operative societies buyers operating from the secondary level are not distinct from the local agents from the view points of members at the primary level. He noted that with all the assistance given, co-operative societies in the Northern states, the share of co-operative societies in the marketing of cotton was less than five percent of the total quantity handled. The co-operative lacked initiative and self –reliance necessary for growth. He remarked that the supervision of the buyers and all marketing functions are the responsibility of the government officials running co-operative unions, and that the co-operative unions, and the co-operatives in the North lacked adequate finance for their operations. They could both finance or repay loans granted to them by the government to the extent that the government tended to usurp the control of co-operative. This is a negation of co-operative society’s principle of self-reliance.

King 1975 – the experience in administration of co-operative credit and market in Northern Nigeria. Institute of Agricultural research Zaria.

 

IMPORTANCE OF ACCOUNTS IN CO-OPERATIVE THROUGH THE MEMBERSHIP OF CTLS

Section 35 (1) of the co-operative rules of the Eastern Nigeria co-operative societies law and rules chapter 28 of revised laws of Eastern Nigeria 1963 states.

The committee of every registered society shall prepare or cause to be prepared yearly in such form as may be prescribed by the register:

a. An account of the registered society’s trading operations for the year.

b. An income and expenditure account.

c. A balance sheet

d. Such statistical information as the registrar may require

I Jere M.O. New Trends in African co-operative section 35 (1) of the co-operative rules of Eastern Nigeria Co-operative societies law and rules chapter 28 of reviewed laws of Eastern Nigeria 1963.

The above statement goes to emphasis the importance of accounts in any co-operative business organisation. Accounting according to Carter “is a discipline concerned with the recording, analysis and forecasting of income and wealth of business and other entities. Generally it records in money terms the flow of economic values within an economic entity and it is applied in two main f fields.

 

MICRO ACCOUNTING AND MACRO ACCOUNTING

Micro accounting is applied in a co-operative organisation and it covers business accounting (financial managerial and cost accounting) government accounting and household accounting.

The financial accountant is concerned with stewardship in terms of both the needs of shareholders and the requirement of the law. As evidence of this stewardship, the financial accountant is required to produce reports, typically the balance sheet and the profit and loss account. These requirement are external to the needs of internal management.

The management accountant is to provide information required by the internal management, there is some “blurring” and ‘overlap’ in that the financial accounts tends to report on or interpret certain aspects of the financials statements. One would consider management accounting as partly the former development of this aspect of the financial accountant’s work. The cost accounting meets the information requirements of management.

 

MANAGEMENT ACCOUNTING

Sizer quotes Josephy R. Dugan who defines the management accountant as “A highly skilled technician, well educated, complex, confident, intelligent, optimistic, who abhors detailed persuasion and enlightened. He wants to be confronted with choices and alternatives, demanding freedom to structure his work, select his alternatives present his solutions and speak for himself.

Management accounting has been defined as the application of accounting techniques to the provision of information designed to assist all levels of management in planning and controlling the activities of the enterprise.

Accounting records which a co-operative society is generally required to keep.

1. Cash book

2. Petty ahs book

3. Day book

4. Purchase book

5. Sales book

6. Debtor’s ledger

7. Creditor’s ledger

8. General ledger

9. Bank loan ledger

10. Members loan ledger

11. Cash sales summary ledger

12. Stock register

13. Fixed asset register

14. Fixtures and fitting register

15. Members register

16. Share register

17. Duty register

18. Minutes register (Board meetings)

19. Minutes register (General meeting)

 

CO-OPERATIVE ACCOUNT

In Nigeria and some of the developing countries co-operative accounts is a distinct subject. Most of the co-operation societies in Enugu State and situated in villages where the members are not well conversant with the subject of double entry, book-keeping. To over come this problem, the co-operative accounts were made easy and simplified so that after importing a short training course, the society secretary may be able to record conveniently the transaction in a set of books and the members of the managing committee can also understand them without difficulty.

The following are the key accounting books:

1. Columnar cash book

2. Columnar members ledger (personal ledger)

3. General ledger

4. Cash book

5. Journal.

Columnar cash book

The cash book is divided into two parts. On the left hand side, all receipts are recorded while on the right hand side all payments are recorded. Columns are drawn to meet the general requirement of the society’s business. In an agricultural co-operative society the money is received on account of share capital, deposits from members, loan recoveries from members, loans from bank, recovery of interest from member, sale proceeds of seed, fertilizers, insecticides etc and the amount would be recorded in the specific columns provided for. Any receipt of money not coming under the specific columns provided in the cash book will be recorded in the miscellaneous column with a description in particular column. The money may be received in cash as well as by cheque. Different columns are provided for it. Cash receipts should be recorded in the cash column while cheques received should be recorded in the bank column. All cheques received and recorded in the bank column must be deposited into the bank for collection on the same day or the following day.

Similar columns are provided on the payment side of the cash book. The same procedure would be adopted in recording all payments. Cash book should be daily balanced and initialed by the secretary and chairman of the society. In the end at the bottom of the cash book, the cumulative totals of receipts and payments under each specific head should be given. These cumulative totals would tell the latest and upto date information about the total receipts and payment under each specific head.

 

Columnar members ledger

Each member will be provided with one ledger. The columns are divided into three parts i.e Debit, credit and balance. The entries would be posted from the cash book with the exception that debit to the interest column would be posted from the journal. The members account will be debited and credited under specific needs from the entries recorded in the cash book or the journal as mentioned above. After each posting the account should be balanced. In the folio column the page number of the cash book journal should be recorded. Similarly, the page number of the members ledger should be recorded in the folio column of the cash book / journal to give effect to the cash reference.

General ledger

The general ledger is recorded by postings made from the cash book as well as the journal. All the necessary accounts will be opened in the general ledger and postings would be made. In addition to the postings made in the members ledger, the totals in respect of each individual head of item will be made in the general ledger. This provides better control to the management.

 

Cash book

In this book all the transactions are recorded as and when they take place. The columnar cash book is then written on the basis of the transactions recorded in the cash book.

Journal

Transactions which do not find a place in the cash book are recorded in the journal. Entries like debiting members account with interest and other adjustment entries are recorded in the journal and then posted in the appropriate ledgers.

Receipts and disbursement statement

This is another specialty in the co-operative accounts. The preparation of receipts and disbursement statement is insisted upon very much in place of TRIAL BALANCE or in addition to trail balance since the trial balance gives only the balance of a particular account and it cannot be known as to what is the volume of transactions behind that balance. The receipts and disbursement statement is prepared by taking the total receipts and total payments under head of account during the period under account without taking the opening balances if there were any. F or preparing the final accounts, the last balance sheet figures will be taken into consideration since the opening balances of the accounts were not totaled in the receipts and disbursement statement.

PROBLEM OF ACCOUNTING IN CO-OPERATIVE CTLS

During the period of investigation, the researcher did not lose sight of the postulations she made in her statement of the problem which serves as the framework upon which the research work is based. Hence during the investigation , questions were mainly directed towards ascertaining the authenticity of the assertions made on the statement of the problems.

For the investigations, the researcher was able to discover a number of facts, some of which agreed with his assertions while some disproved some of the assertions. The findings of the investigation are discussed under the following headings.

1. The Problem of unqualified accounting personnel officers:

This problem has been identified as one of the serious problems withholding the growth of co-operative societies in Enugu State in particular and in Nigeria in general. Research has shown that this problem is rooted in the provision of the co-operative law and bye-laws, that the management of the co-operative societies should be invested in the hands of people elected from among the membership. This is usually not based on the capabilities of experience but because it has been provided in the bye-laws that such officers were to be elected from the membership ie whether or not the right calibre of people are to be found in the society such people would be elected from there. We have been able to see from the review of literature that for any business organisation to stand firmly on its own, it would basically require finance which itself is very versatile. Then, because of the versatile nature of finance, it requires a very serious attention from an expert in its management.

 

Again, having seen all the qualities expected of a finance officer in any organization, our co-operatives thereby stand, wanting in the qualities of their officers doing the work of the finance officers.

Information gathered from the case society about the qualifications of the officers and staff of the society revealed that the manager only had his standard six, the Clerk – TC II, the two salesmen first school leaving certificate and TC II respectively. Even though we don’t pay much emphasis on the educational qualifications than on the experience and one’s willingness to do a job, there is need for a basic orientation of one to one’s course of action. Basic formal education and technical education are both needed by whoever that finds his/herself on the seat of management of these ventures. Thus, Dr. E. Onuoha, in his book “principles of co-operative enterprise said “perhaps the most intriguing assumption of the principles of limited interest on capital is the assumption that a co-operative should be efficiently managed that it would cover its cost, breakeven and show a net surplus. For unless it can do this, it will have nothing to pay to its shareholders and will lose its economic justifications”. Qualified professionals have to be employed by the co-operatives and when employed given full scope to perform, subject only to ultimate control by the Board of Directors or the general meeting.

Training programme for co-operative staff should thus be mainly devoted to technical and practical subjects of management with a view to increasing their service capacity.

Hence with due difference the discussions above, coupled with the practical experience about the working and operatives of these co-operatives, we hereby institute a call for the review of the length of or the durations of training being given of present co-operative inspectors-in-training and to call for the inclusion in their curriculum of such relevant courses that will enable them to be fully equipped for their work. Also to be included in this programme is the free training of the officers of various co-operative societies on the relevant subjects/courses to enable them carry out such duties that will project the image of their societies economically or recruitment of more people to be trained as co-operative inspectors who should be posted each to a co-operative society to manage its activities in accordance with the knowledge gained. These recommendations even though quite costly, are still appropriate since co-operative is in the Nigerian context an instrument of development. It should be government sponsored as it is already in progress. The call is only on the improved quality and amount of the sponsorship.

2. The Problem of proper books of accounts:

It was apparent from the observations made on the operations and functionings of the cased society that it has got no problem with regards to the keeping of correct books of account. But however, one idea not yet grasped by the society is that the keeping of correct books of accounts is not an end itself, but a means to an end. The emphasis on the keeping of correct books of account is not exhaustive in itself if let alone but it is kept for use in the planning, controlling and co-ordinating the activities of the society.

In other words, its importance is seen on its use in the analysis of future situations. This happens that when the keepers could not draw up financial statement like the manufacturing, trading and profit and loss account, the balance sheet and the fund flow statements from such records kept, the aim of keeping of such records has been defeated. Hence, the need for recruitment of well-informed personnels cannot be over-emphasised. The co-operative societies financial statement end with the balance sheet. As earlier mentioned, the balance sheet is the starting point for exploration of other planning techniques to accomplish the goal of any business organizations.

3. The Problem of not operating on a Budget:

A budget is defined as an instrument of management used as aid to the committee, in the case of a co-operative society, in planning and controlling of the business activities of the society. In other words, it is a forecast made by the committee about the operations of a co-operative society in a year.

It is necessary for every committee while preparing its budget to differentiate between the capital budget and revenue budget. The capital budget deals with the capital income and capital expenditure or investment, while the revenue budget deals with income and expenditure or the profit and loss which will be designed to shown either a net surplus or net deficit in the account at the end of a given period, say a year.

The committee must ensure that it prepares its budget for every succeeding financial year for the approval of the general meeting before the end of that year. This will enable the society to have a guide for its operations during such financial year.

Capital Budget:

As already explained, the capital budget deals with the capital income and capital expenditure and investments. Here, it is necessary to mention the sources of capital income. These include share contribution, member savings, deposits and loans from members and non-members. Capital expenditure on the other hand, comprises loans to members, investments in form of shares in companies or acquisition of landed properties.

While preparing either the capital or revenue budget, it is always important to review the corresponding budget for the previous year and the actual expenditure for that year as well.

Revenue Expenditure:

The preparation of a revenue budget involves the forecast of what the recurrent income and the recurrent expenditure are expected to be with the view to achieve either a net surplus or a net deficit at the end of a period’s operation.

 

The items that constitute recurrent income are as follows:

Entrance fees from member loan, interest, fines,Interest on bank savings, interest or dividends from Investments, rent received and possibly donations.

The following comprise the recurrent expenses:

entertainment, transport, bank charges, affiliation fees, audit and supervision fee, annual subscription, donation to prepare a revenue budget the committee should also refer to both the previous year’s budget and actual expenditure in order to determine where there will be increase or decrease in the new budget.

These two budgets will serve as guide to committee members of other types of co-operative societies. The first important fact to bear in mind while preparing a year’s budget is that capital estimates should be separated from the recurrent estimates. The previous year’s budget and capital expenditure for each item will serve as guide to the committee.

When one does not operate on a budget it means that one does not have a target, a plan of action towards which one aims. It also means that if one operates below standard one would not know, because after all, one has not got a set standard for one’s operation towards which one aims.

 

LAYOUT OF A REVENUE BUDGET 1977/78

EXPENDITURE Provisions Actual INCOME Provisions Actual

1976-77 1977-78 Expenditure 1976-77 Increase Decrease 1976-77 1977-78 Expenditure 1976/77 Increase Decrease

Purchase of stationary 50 40 35 – 10 Entrance fee 30 50 40 20 –

Transport 15 30 20 15 – Sales of stationery 5 5 4 – –

Bank Charges 30 145 35 115 – – – – – – –

Affiliation fee 8 – 8 – – Loan interest 850 1300 900 450 –

A. S. F. 6 10 6 4 – Fines 30 20 20 – 10

Depreciation 60 60 50 – – Donations – 10 5 10 –

Rent 100 120 96 20 – Dividend from – 75 60 75 –

Wages 120 132 125 12 – Investment –

Annual subscriptions 8 4 4 – 4 Sundry income 20 10 15 – –

Entertainment 100 120 75 20 – Interest on

Estimated net surplus 453 824 602 – – Bank savings 15 15 12 – –

950 1485 1056 – – 950 1485 1056

 

EXPENDITURE Provisions Actual INCOME Provisions Actual

1976-77 1977-88 Expenditure 1976-77 Increase Decrease 1976-77 1977-78 Expenditure 1976/77 Increase Decrease

Loan to members 5000 8500 5500 3500 – Share capital 3500 5000 2750 1500 –

Furniture – 40 29 11 – Thrift savings 1000 1200 900 200 –

Share in companies 700 – 720 720 – Bank loan – 3000 – 3000 –

5700 8540 6249 3540 700 4500 9200 3650 5450 –

 

Training course for secretaries and committees of co-operative societies of Nsukka Zone Committee secretaries 26th – 28th July 1978, 7th – 11th August 1978.

 

4. The problem of insufficient capital

Equally identified as one of the serious problems militating against the effective operation of co-operative capital for their operations.

Findings from the investigations reveal that the cased society has her sources of fund as thrift savings, contribution from members, share capital of members, special savings, dividends and government loans.

The analysis of these sources reveals that thrift savings are the monthly contributions of members (N1) share capital is paid once and for all, except those that pays theirs installmentally. The investigation carried out showed that none of the members has paid any thing beyond the minimum share capital holding, even though the majority has completed their minimum share capital of (N100).

The society gets just a token as dividends from the co-operative and commerce bank (CCB) Nigeria Limited, the Anambra Co-operative Financing Agency (ACFA) Ltd. and this is not so frequent.

It is recommended that the government should always crown the noble initiatives and efforts of these societies with success by giving them some reasonable amounts as grants or engaging in joint ventures. These may all be in effort to achieve our rural development and thereby avert the ugly consequence of rural urban migration and unemployment.

5. Problem of Insufficient membership/investment in CTLS

Facts gathered from the cased society show that the society has a problem as regards to membership. This is because, with less than two hundred and fifty members, its register of members is insufficiently filled up. With this number the problem of capital for viable projects

The society has few members and the generality of our rural populace are poor. Despite the fact that membership of the co-operative is open to every individual of good character, some rich investors still remain scare form co-operatives.

The reason for this was found out from some of the answers given by the respondents, that:

– some people do no like group effort, hence many private enterprises.

– Some don’t have trust on other people. the fear the loss or embezzlement of their money.

– Our people, in the majority want immediate return which is not reading found in the co-operative societies.

SOLVING THE PROBLEM OF PERENNIAL CASH SCARCITY (AMONG WORKER) THROUGH THE MEMBERSHIP OF CTLS.

As earlier mentioned we are not going to deal with all the problems of the perennials cash scarcity through the membership of CTLS but on the accounting aspect of the problems. We are therefore focussing our mind on the hazards of poor accounting in the membership of CTLS. We are the same time having regard to the bottleneck posed by the strict adherence of the traditional co-operative principles.

Co-operative societies have been accepted by the Enugu state government as an effective instrument for the brightening up of the economic outlook of the rural communities.

Even though the main source of capital for the co-operative societies is the members shares and other contributions, the wide spread prevent and consequent indebtedness of the rural population, coupled with the fact that wealthy men the capital have technical been scared away by the de-emphasis of capital principal principles (in the form of poor remuneration of capital), have made it yet an unrealizable objectives unless enough capital is available to embers or the co-operative itself operative is available to members or the eventual liquidation thereby defeating the aim and objectives behind their formation. Co-operation as a business organizations need the application large sum of money in other to carry out their numerous activities to make surplus.

In this case the government with either take the full sponsorship of these co-operatives activities (ie they would become government agencies) or it should be given the opportunity/option to raise its funds through such means available to it, one of which is the proper remuneration of capital so that investors would think of investing in these societies.

The bank (Nigerian) Ltd has now succeeded likewise other big co-operative organisations – Anambra Co-operative federal Anambra co-operative financial agency National Association of co-operative union movement (NACUM) etc because they were allowed to adopt some of the “joint stock company” procedures, such as the use or proxy during election. Government and big business men with capital have been attracted to the organisations. Other examples are insurance companies of the government and government corporations that now make fantastic profits because they have been allowed to go commercial, just like other commercial companies.

The suggestion is that of the review of the co-operation law to remove the bottleneck restricting the raising of the capital for the co-operative from external sources as mentioned above. The situational or purposeful application of the co-operative principles should be absorbed in Nigeria. For instance, in a capitalist economy a different application is to be observed.

In some societies most of the members do not absorb the co-operative principles. Because a majority of members are illiterate and ignorant of the working of their societies, they tend to keep aloof from the organization except for getting the benefits for which they joined the societies. This is because our people by nature or culture do not welcome such rules of the principles. In this case co-operative principles should be made to suit the co-operators and not the co-operators made to suit the principles. After all, law is made for man and not man for the law. Where both the law and the principles can no longer held us, we should amend them to suit us.

CONCLUSION

The review of the length of training being given to the present co-operative, inspectors in training to allow for the inclusion in their curriculum such relevant courses that will enable them be fully equipped for their work.

Also to be included in this programme is the free training of the officers of various co-operative societies on the relevant course to enable them carry out such duties that will project the image of their societies economically or the recruitment of more people to be trained as co-operative inspectors who should be posted each to a co-operative society to manage its activities in accordance to the knowledge gained.

These recommendation even though are to be costly are still appropriate since co-operative is in the Nigeria context instrument of development. It should be government sponsored as it is at present. The call is only on the improved quality and amount of the sponsorship. Before 1979, co-operative inspectors were given motor cycle allowances and grants to enable them carryout their work effectively but such no longer in their scheme of the sponsorship today.

CO-OPERATIVE SOCIETY – BENEFIT OF CO-OPERATION UNION, ACCOUNTS