Unit 1
Final Accounts of Co-operative Societies
Q1) What do you mean by Co-operative society?
A1) Co-operative society came into existence due to the exploitation of the economically and socially weaker section of the society; by manufactures / big businesspersons / whole / Retailers.
The Co-operative movement first started in Europe; particularly in England and Germany.
When weaker section of society is finding out difficult with less earning; they were organised them self for mutual help. These organizations lead to firm a Co-operative society.
A Co-operative society can be defined as an association of people usually of a limited means, who have voluntarily joined the organisation making equitable contribution to the capital required and excepting a share and risks and benefits of the organisation. Normally a Co- operative society is a service organization is not interested in making profit.
A Co-operative society is most important form of organisation in Indian economic screen. Co-operative societies are covered by different state Laws which differs from state to state.
Co-operative societies as form of organisation doing the business are assuming a growing importance, next to corporate sector on the Indian economic sense. Co-operative Society is a collective effort of large number of people, operating in various fields of activities such as co- operative sugar factories, spinning and weaving mills, co-operative credit societies, Urban co- operative Banks, consumers co-operative societies, Industrial co-operative societies, housing societies and so on.
Q2) Discuss the allocation of profit as per Maharashtra State Co-operative Societies Act?
A2) Maharashtra is the second most populated state in India, and therefore, a Maharashtra Cooperatives Society Act is just the right fit for the state. With its population, it is not a shock that there are over 5 crore members to the existing nearly two lakh cooperative societies. Cooperative housing societies are a part of the cooperative societies and are governed by the Maharashtra Cooperative Societies Act 1960 (latest Maharashtra cooperative Societies Act 2019). The MCS Act 1960 was brought into action on 26 January 1962. A few amends were made to the Maharashtra Cooperative Housing Society Act (as the centre mandated) on 13 February 2013. The amends of the Maharashtra Cooperative Society rules came into action the very next day i.e., 14 February 2013.
The Maharashtra Cooperative Societies Act or the Maharashtra Housing Society Act 1960 states its key features based on better housing plans for its people. It provides an inclusive and easy registration system, membership perks and includes the privileges and duties offered all over Maharashtra. The Maharashtra Cooperative Act aims to provide a fair system and solutions in Maharashtra for cooperative societies.
Under the Maharashtra Cooperative Housing Society Act 1960, the main purpose is to offer/provide its members with better housing opportunities such as open flats, apartments, and plots. In addition to this, it also aims at providing its members with the luxury of basic amenities.
In Maharashtra Co-op movements, give way to Co-op. Sugar Factories, Left Irrigation, and Co-op Housing Society. A Co-operating society is a voluntary organisation formed for the purpose of promoting & protecting interest of its members. The main objective of Co-operative society is to protecting interest of its members. It does earn profit which may be partly distributed among its members and partly kept as reserves.
Maharashtra is considered as a most progressive state in the development of Co-operative Societies. The Accounting Procedures and Final Accounts Formats differ from state to state as each state in India has its own Co-operative Act. Let us study the main provisions of the Maharashtra Co- operative Societies (MCS) Act, 1960 and the Maharashtra State Co-operative Societies Rules, 1961.
Q3) Define Co-operative society and working capital under MCS Act?
A3) Under section 2(27) of the Act, Society means a co-operative society registered or deemed to be registered under this Act. Co-operative society is corporate body distinct from its members. Section 167 of Co-operative Societies Act state that provisions of Companies Act are not applicable to Co-operatives.
Working Capital: Under section 2(31) of the Act, ‘Working Capital ‘means funds at the disposal of society inclusive of paid-up share capital, funds build up out of profits and money raised by borrowing and other means. The definition of the term is different as generally working capital means Net Current Assets represented by Current Assets Less Current Liabilities.
Q4) What are the types of the Maharashtra Co-operative societies?
A4) The Maharashtra Co-operative Societies Act classifies societies under various categories as under:
(1) Credit Co-operative Society:
This is oldest type of co-operative in India. It comes into existence around 1904 with the passing of co-operative societies Act 1904.
The main purpose of this type of societies is to provide loans to members, at low rate of interest.
(2) Consumers co-operative society:
Consumers form it. The consumers co-operative society purchases in bulk and in large quantities and sells it to members / to consumers at reasonable prices and also good quality. Therefore, consumers co-operative society eliminate intermediaries between buyers and sellers / manufacturers.
(3) Industrial Co-operative Society:
It is organised by small producers to carry out certain production activities e.g., sugar mills / milk / cotton cloths co- operative societies.
(4) Agricultural Marketing Society:
It means that a society which is marketing agricultural produce ii) At least ¾ of its member are agriculturist.
(5) Co-operative Bank:
For doing banking business as per section 5 of Bank Companies Act. / For doing Banking business permission of R.B.I. Required.
(6) Co-operative Housing Societies:
These types of societies are formed for the purpose providing to its members dwelling houses or flats acquired by its members with common amenities and services. In Maharashtra house construction activities are regulated by Maharashtra Ownership Flat Act, 1963.
(7) Apex society
(8) Central Bank
(9) Farming society
(10) Crop protection society
(11) Federal society:
It is a society which has not less than five members are societies and has also regulated 80% of voting rights is held by co-operative societies.
(12) Lift Irrigation society.
Q5) Explain Ascertainment and Appropriation of profits under section 65?
A5) A society shall construct its relevant annual financial statements and arrive at its consequent net profit or loss in the manner prescribed.
A society may appropriate [its net profits] to the reserve fund or any other fund to payment of dividends to members on their shares to the payment of bonus on the basis of support received from members and persons who are not members to its business, to payment of honoraria and towards any other purpose which may be specified in the rules or bye-laws:
Provided that no part of the profits shall be appropriated except with the approval of the annual general meeting and in conformity with the Act, rules and bye-laws.
1. Section 65(1) of the Act, amended in 1985, states that a society shall construct its relevant annual financial statement and arrive at its consequent net profit or loss in the manner prescribed. A co-operative society engaged in a business of Manufacturing, Trading or Banking should adopt mercantile system of accounting to arrive at true and fair profits. The
2. Section 65(2) states that a society may appropriate its Net Profit to the reserve fund or any other fund for payment of dividend to members on their shares. No parts of the profits shall be appropriated except with the approval of the General Body.
3. Section 64 of the Act states that no part of the funds other than the dividend equalisation or Bonus equalisation shall be paid by way to bonus or dividend to its members.
4. According to section 68 every society shall contribute annually towards the Education Fund and Rule No.53 prescribes the rates of contribution according to the nature of society.
| Class of society | Rate |
1 | Primary Consumers Society | 2 Paise per Rs.100 of the working capital subject to a maximum of Rs.1,000. |
2 | Urban Credit Society | 10% of the working capital in respect of those which have earned |
|
| Profit during the previous year subject to maximum of Rs.500 |
3 | Co-operative Sugar Factories | 25 paise per ton of sugarcane crushed subject to maximum of Rs.25,000. |
4 | Housing Society Backward Class housing society | Re.1 per member having a tenement Rs.10. |
5 | Urban credit bank | 1/10% of working capital subject to a maximum of Rs.1,000. |
Q6) State the format of Income and expenditure account.
A6)
FORMAT OF INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes |
|
| -Property Expenses |
|
|
Water Charges |
|
|
|
|
|
Common Electricity charges |
|
|
|
|
|
Repairs & Maintenance |
|
|
|
|
|
Insurance charges |
|
| II. Collection from Members for |
|
|
Club House Expenses |
|
| -Establishment Expenses |
|
|
II. Establishment Expenses |
|
|
|
|
|
Salaries |
|
|
|
|
|
Office Expenses |
|
|
|
|
|
Accounting charges |
|
|
|
|
|
Printing & Stationery |
|
|
|
|
|
Conveyance |
|
|
|
|
|
Election Fund |
|
| III. Interest & Dividend |
|
|
Subscriptions of Hsg Federation |
|
| Interest on Savings Bank |
|
|
Audit Fees |
|
| Interest on Fixed Deposits |
|
|
Security Charges |
|
| Interest on Investments |
|
|
Salaries |
|
| Dividend on Shares/MF |
|
|
III. Other Expenses |
|
|
|
|
|
Depreciation |
|
| IV. Other Income |
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
| Total |
|
|
Q7) Prepare the format of balance sheet.
A7) FORMAT OF Balance Sheet
Liabilities | Amount | Assets | Amount |
Share Capital |
| Cash & Bank Balance |
|
Authorized, Issued and Paid- Up |
| Cash in hand |
|
Purchased by the Government |
| At Bank (also called Deposits) |
|
Purchased by Co-operative Societies |
| Investments |
|
Purchased by Individuals |
| Government Securities |
|
Shares in Advance |
| Shares in Co-operative Institution |
|
Less: Calls in Arrears |
| Fixed Deposits with Banks |
|
Add: Calls in Advance |
| Provident Fund Investments |
|
Subscription/Deposits Towards shares |
| (Including advances to provident Fund) |
|
Reserve Fund and Other Funds |
| Loans and Advances |
|
Reserve Fund |
| Loans |
|
Building Fund |
| Cash Credit |
|
Development Fund |
| DuefromtheManaging Committee |
|
Reserve for Doubtful Debts |
| Sundry Debtors |
|
Depreciation Fund |
| For Credit Sales |
|
Dividend Fund |
| For Advances |
|
Bonus Equalization Fund |
| Current Assets |
|
Other Equalization Fund |
| Tools and Equipment’s |
|
Staff Provident Fund |
| Closing Stock |
|
Debentures |
| Work in Progress |
|
Cash credit |
| Fixed Assets |
|
Overdraft |
| Land and Building |
|
Loans |
| Plant and Machinery |
|
Government Loans |
| Live stocks |
|
Other secured Loans |
| Dead socks |
|
Secured Loans |
| Vehicles |
|
Unsecured Loans |
| Other Expenses and Losses |
|
From Banks |
| (Not written off) |
|
From Government |
| Preliminary Expenses |
|
Bills payable |
| Advances |
|
Others |
| Payment of Taxes |
|
Deposits |
| Goodwill |
|
Fixed Deposits |
| Deferred Revenue Expenses |
|
Saving Deposits |
| Expenses in connection with issue Of Debentures |
|
Recurring Deposits |
| Losses |
|
Other Deposits |
| Add: Current Loss |
|
CurrentLiabilitiesand Provisions |
|
|
|
Sundry Liabilities |
|
|
|
Outstanding Salaries etc. |
|
|
|
Advances |
|
|
|
Unclaimed Dividend |
|
|
|
Interest due but not paid |
|
|
|
Other Liabilities |
|
|
|
Income & Expenditure account |
|
|
|
Opening Balance |
|
|
|
Add: Current Year Profit |
|
|
|
|
|
|
|
Total |
| Total |
|
Q8) From the following trail balance, prepare final accounts in the prescribed format.
Roshni Co-Op Housing Society Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 3,995 | Collection from Members |
|
Cash at Bank | 93,144 | -For Property Expenses | 37,056 |
Dues from Members | 52,903 | -For Service Charges | 5,140 |
Water pump | 4,113 | Members Deposit | 7,100 |
Deposits for Electricity | 595 | Interest- FD | 3,017 |
Deposits for Water | 380 | Interest- SB | 1,005 |
Property taxes | 10,346 | Sinking Fund (Bal b/d) | 34,560 |
Water Charges | 7,513 | Statutory Reserve Fund (Bal b/d) | 38,470 |
Common Electricity Charges | 10,240 | Subscribed Share Capital |
|
Subscriptions to Election Fund | 36 | 60 shares of Rs 50 each | 3,000 |
Office Expenses | 3,425 | Surplus for last year | 74,038 |
Printing & Postage | 776 |
|
|
Conveyance | 570 |
|
|
Subscriptions to Housing Federation | 500 |
|
|
Audit Fees | 1,000 |
|
|
Security Charges | 13,850 |
|
|
|
|
|
|
Total | 203,386 | Total | 203,386 |
|
|
|
|
Additional Information:
- Authorised share Capital is 2,000 shares of Rs 50 each
- Depreciation on water pump @ 15%
- Collection from Members for Service Charges include
- Entrance fees Rs 100
- Contribution for sinking fund Rs 1,440
A8)
Roshni Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes | 10,346 |
| -Property Expenses |
| 37,056 |
Water Charges | 7,513 |
|
|
|
|
Common Electricity charges | 10,240 | 28,099 |
|
|
|
|
|
|
|
|
|
|
|
| II. Collection from Members for |
|
|
|
|
| -Establishment Expenses |
|
|
II. Establishment Expenses |
|
| Vide Trial Balance | 5,140 |
|
Office Expenses | 3,425 |
| Less: Entrance Fees | (100) |
|
Printing & Postage | 776 |
| Less: Sinking Fund | (1,440) | 3,600 |
Conveyance | 570 |
|
|
|
|
Election Fund | 36 |
| III. Interest & Dividend |
|
|
Subscriptions of Hsg Federation | 500 |
|
|
|
|
Audit Fees | 1,000 |
| Interest SB | 1,005 |
|
Security Charges | 13,850 | 20,157 | Interest FD | 3,017 | 4,022 |
|
|
|
|
|
|
III. Other Expenses |
|
|
|
|
|
Depreciation |
| 617 | IV. Other Income |
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
| (4,195) |
|
|
|
|
|
|
|
|
|
Total |
| 44,678 | Total |
| 44,678 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 3,995 |
|
2000 shares of Rs 50 each |
| 1,00,000 | At Bank (also called Deposits) | 93,144 | 97,139 |
Subscribed |
|
| Investments |
| - |
60 shares of Rs 50 each |
| 3,000 | Provident Fund Investments |
| - |
Subscription/Deposits Towards shares |
| - | (Including advances to provident Fund) |
|
|
Reserve Fund and Other Funds |
|
| Loans and Advances |
| - |
Statutory Reserve Fund |
|
| Sundry Debtors |
|
|
Opening Less: Entrance Fees | 38,470 100 | 38,570 | Dues from Members |
| 52,903 |
Sinking Fund |
|
|
|
|
|
Opening Additions to SF | 34,560 1,440 | 36,000 | Current Assets |
| - |
|
|
| Fixed Assets |
|
|
Staff Provident Fund |
| - | Water Pump | 4,113 |
|
Secured Loans |
| - | Less: Depreciation | (617) | 3,496 |
Unsecured Loans |
| - | (4113 x 15%) |
|
|
Deposits |
|
|
|
|
|
Members Deposits |
| 7,100 |
|
|
|
Current Liabilities and Provisions |
| - | Other Expenses and Losses |
| - |
Unclaimed Dividend |
| - | Other Assets |
|
|
Interest due but not paid |
| - | Deposits for Electricity | 595 |
|
Other Liabilities |
| - | Deposits for Water | 380 | 975 |
Income & Expenditure account |
|
|
|
|
|
Opening Balance | 74,038 |
|
|
|
|
Less: Current Year Deficit | (4,195) | 69,843 |
|
|
|
|
|
|
|
|
|
Total |
| 1,54,513 | Total |
| 1,54,513 |
Q9) The following trial balance as on 31-3-18, prepare final accounts in the prescribed format.
Venkat Park Co-Op Housing Society Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 5,443 | Collection from Members |
|
Cash at Bank | 351,595 | -For Property Expenses | 86,662 |
Accounting Charges | 5,000 | -For Establishment Charges | 23,040 |
Accumulated losses not w/off | 262,532 | Entrance Fees | 170 |
Audit Fees | 750 | Interest- FD | 44,503 |
BMC Deposit for Water | 1,664 | Interest- SB | 10,750 |
BSES Deposit | 1,195 | Redevelopment charges | 300,000 |
Clubhouse Expenses | 35,020 | Statutory Reserve Fund (Bal b/d) | 399,773 |
Electricity Charges | 18,070 | Subscribed Share Capital |
|
Dues from Members | 83,817 | 60 shares of Rs 50 each | 3,000 |
Insurance Charges | 14,615 | Transfer Fees | 90 |
Structural Audit Fees | 14,750 | Outstanding Expenses | 9,950 |
Postage | 1,679 |
|
|
Property Taxes | 9,410 |
|
|
Repairs & maintenance | 49,723 |
|
|
Salaries | 6,000 |
|
|
Conveyance | 500 |
|
|
Water Charges | 16,175 |
|
|
|
|
|
|
|
|
|
|
Total | 877,938 | Total | 877,938 |
|
|
|
|
Additional Information:
- Authorised share Capital is 2,000 shares of Rs 50 each
- Prepaid Insurance Rs 11242
- Redevelopment charges collected from members to be refunded to members.
A9)
Venkat Park Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes |
| 9,410 | -Property Expenses |
| 86,662 |
Water Charges |
| 16,175 |
|
|
|
Electricity charges |
| 18,070 | II. Collection from Members for |
|
|
Repairs & Maintenance |
| 49,723 | -Establishment Expenses |
| 23,040 |
Insurance Charges | 14,615 |
|
|
|
|
Less: Prepaid | (11,242) | 3,373 |
|
|
|
Club House Expenses |
| 35,020 |
|
|
|
II. Establishment Expenses |
|
| III. Interest & Dividend |
|
|
Accounting charges | 5,000 |
|
|
|
|
Postage | 1,679 |
| Interest SB | 10,750 |
|
Conveyance | 500 |
| Interest FD | 44,503 | 55,253 |
Salaries | 6,000 |
|
|
|
|
Audit Fees | 750 |
| IV. Other Income |
|
|
Structural Audit Fees | 14,750 | 28,679 |
|
|
|
|
|
|
|
|
|
III. Other Expenses |
|
|
|
|
|
IV. Surplus/(Deficit) |
| 4,505 |
|
|
|
|
|
|
|
|
|
Total |
| 1,64,955 | Total |
| 1,64,955 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 5,443 |
|
2000 shares of Rs 50 each |
| 1,00,000 | At Bank (also called Deposits) | 3,51,595 | 3,57,038 |
Subscribed |
|
| Investments |
| - |
60 shares of Rs 50 each |
| 3,000 | Provident Fund Investments |
| - |
Subscription/Deposits Towards shares |
| - | (Including advances to provident Fund) |
|
|
Reserve Fund and Other Funds |
|
| Loans and Advances |
|
|
Statutory Reserve Fund |
|
| Prepaid Insurance |
| 11,242 |
Opening | 3,99,773 |
| Sundry Debtors |
|
|
Add: Entrance Fees | 170 |
| Dues from Members |
| 83,817 |
Add: Transfer Fees | 90 | 4,00,033 | Current Assets |
| - |
|
|
| Fixed Assets |
| - |
Staff Provident Fund |
| - | Other Expenses and Losses |
| - |
Secured Loans |
| - |
|
|
|
Unsecured Loans |
| - |
|
|
|
Deposits |
| - | Other Assets |
|
|
|
|
| BSES Deposit | 1,195 |
|
Current Liabilities and Provisions |
|
| BMC Deposit for Water | 1,664 | 2,859 |
Outstanding Expenses | 9,950 |
|
|
|
|
Redevelopment charges refundable | 3,00,000 | 3,09,950 | Income & Expenditure account |
|
|
Unclaimed Dividend |
| - |
|
|
|
Interest due but not paid |
| - | Opening Balance (Accumulated Losses) | 2,62,532 |
|
Other Liabilities |
| - | Less: Current Year Surplus | (4,505) | 2,58,027 |
Income & Expenditure account |
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
| 7,12,983 | Total |
| 7,12,983 |
Q10) From the following trail balance, prepare final accounts in the prescribed format.
Shark CHS Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 14,984 | Collection from Members |
|
Cash at Bank | 2,36,071 | -For Property Expenses | 16,99,152 |
Water Pump | 12,390 | -For Establishment Charges | 11,57,017 |
Fixed Deposits | 61,37,752 | Entrance Fees | 200 |
Audit Fees | 17,524 | Interest on sinking fund investment | 7,61,946 |
BMC Deposit for Water | 6,625 | Interest- SB | 1,212 |
Tata Power Deposit | 14,200 | Redevelopment charges |
|
Fixed Deposits- Sinking Fund | 26,90,000 | Statutory Reserve Fund (Bal b/d) | 1,35,515 |
Electricity Charges | 3,41,324 | Subscribed Share Capital |
|
Dues from Members | 60,236 | 350 shares of Rs 50 each | 17,500 |
Insurance Charges | 27,695 | Transfer Fees | 500 |
Equipment’s | 3,90,256 | Surplus for last year | 6,19,986 |
Furniture & Fittings | 11,718 | Tower Rent | 1,96,542 |
Property Taxes | 5,89,710 | Sinking Fund (Bal b/d) | 67,12,745 |
Repairs & maintenance | 1,40,616 | Collected for Sinking Fund | 5,71,596 |
Salaries | 6,75,783 |
|
|
Security charges | 1,31,952 |
|
|
Water Charges | 1,30,485 |
|
|
Accrued Interest FD- Sinking Fund | 70,299 |
|
|
Housekeeping Exps | 1,48,310 |
|
|
Advances Staff | 26,081 |
|
|
Additional Information:
- Authorised share Capital is 28,000 shares of Rs 50 each
- Provide Depreciation
- Equipment’sRs 71,996
- Water PumpRs 1,858
- FurnitureRs 1,172
3. Prepaid Insurance Rs 13,660
4. Prepaid Maintenance Rs 15,571
5. O/s Property Taxes Rs 5,97,603
6. Advance from members for service charges Rs 30,181
7. Tower rent received in advance Rs 44,065.
A10)
Shark Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes | 5,89,710 |
| -Property Expenses |
| 16,99,152 |
Add: O/s Property Taxes | 5,97,603 | 11,87,313 |
|
|
|
Water Charges |
| 1,30,485 |
|
|
|
Electricity charges |
| 3,41,324 |
|
|
|
Repairs & Maintenance | 1,40,616 |
|
|
|
|
Less: Prepaid | (15,571) | 1,25,045 | II. Collection from Members for |
|
|
|
|
| -Establishment Expenses | 11,57,017 |
|
Insurance Charges | 27,695 |
| Less: Advance | (30,181) | 11,26,836 |
Less: Prepaid | (13,660) | 14,035 |
|
|
|
|
|
|
|
|
|
II. Establishment Expenses |
|
| III. Interest & Dividend |
|
|
Housekeeping | 1,48,310 |
|
|
|
|
Security | 1,31,952 |
| Interest SB |
| 1,212 |
Salaries | 6,75,783 |
|
|
|
|
Audit Fees | 17,524 |
|
|
|
|
III. Other Expenses |
|
| IV. Other Income |
|
|
Depreciation |
|
| Tower Rent | 1,96,642 |
|
Equipment’s | 71,996 |
| Less: Advance | (44,065) | 1,52,577 |
Water Pump | 1,858 |
|
|
|
|
Furniture | 1,172 | 75,026 |
|
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
| 1,32,980 |
|
|
|
|
|
|
|
|
|
Total |
| 29,79,777 | Total |
| 29,79,777 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 14,984 |
|
28000 shares of Rs 50 each |
| 14,00,000 | At Bank (also called Deposits) | 2,36,071 | 2,51,055 |
Subscribed |
|
| Investments |
|
|
350 shares of Rs 50 each |
| 17,500 | Fixed Deposits | 61,37,752 |
|
Subscription/Deposits Towards shares |
| - | Fixed Deposits SF | 26,90,000 |
|
Reserve Fund and Other Funds |
|
| Add: Accrued Interest | 70,299 | 88,98,051 |
Statutory Reserve Fund |
|
| Provident Fund Investments |
| - |
Opening | 1,35,515 |
| (Including advances to provident Fund) |
|
|
Add: Entrance Fees | 200 |
| Loans and Advances |
|
|
Add: Transfer Fees | 500 | 1,36,215 | Prepaid Insurance | 13,660 |
|
Sinking Fund |
|
| Prepaid Maintenance | 15,571 | 29,281 |
Opening | 67,12,745 |
| Sundry Debtors |
|
|
Addition | 5,71,596 |
| Dues from Members | 60,236 |
|
Interest on SF FD | 7,61,946 | 80,46,287 | Advances- Staff | 26,081 | 86,317 |
|
|
| Current Assets |
|
|
Staff Provident Fund |
| - | Fixed Assets |
|
|
Secured Loans |
| - | Equipment’s | 3,90,256 |
|
Unsecured Loans |
| - | Less: Depreciation | (71,996) | 3,18,260 |
Deposits |
| - | Furniture | 11,718 |
|
Current Liabilities and Provisions |
|
| Less: Depreciation | (1,172) | 10,546 |
Outstanding Expenses | 5,97,603 |
| Water Pump | 12,390 |
|
Advance from Members | 30,181 |
| Less: Depreciation | (1,858) | 10,532 |
Income received in advance | 44,065 | 6,71,849 |
|
|
|
|
|
| Other Expenses and Losses |
|
|
Unclaimed Dividend |
| - | Other Assets |
|
|
Interest due but not paid |
| - | Tata Power Deposit | 14,200 |
|
Other Liabilities |
| - | BMC Deposit for Water | 6,625 | 20,825 |
Income & Expenditure account |
|
|
|
|
|
Surplus for last year | 6,19,986 |
| Income & Expenditure account |
|
|
Add: Current year surplus | 1,32,980 | 7,52,966 |
|
|
|
|
|
|
|
|
|
Total |
| 96,24,817 | Total |
| 96,24,817 |
Q11) Discuss Maharashtra Cooperative Societies Act 1960.
A11) The Maharashtra Cooperative Societies Act or the Maharashtra Housing Society Act 1960 states its key features based on better housing plans for its people. It provides an inclusive and easy registration system, membership perks and includes the privileges and duties offered all over Maharashtra. The Maharashtra Cooperative Act aims to provide a fair system and solutions in Maharashtra for cooperative societies.
Under the Maharashtra Cooperative Housing Society Act 1960, the main purpose is to offer/provide its members with better housing opportunities such as open flats, apartments, and plots. In addition to this, it also aims at providing its members with the luxury of basic amenities.
Q12) Define Auditor under MCS Act?
A12) Rule No.69 of Co-operative Societies Rules states that the audit co-operative societies shall be conducted either by departments auditor or certified auditors. The term certified auditors include the following:
• Chartered Accountant
• A person who holds a government diploma in Co-operative Accounts and Audit.
• A person who has served as an auditor in the co-operative department of the state government (Retired officers of the co-operative department.
Q13) What are Bye-laws under MCS Act?
A13) Under section 2(5) ‘Bye-laws ‘registered under this Act and for the time being in force, and includes registered amendments of such bye-laws. Bye-laws of a co-operative society may be compared with the articles of a company.
The Provision in the bye-laws cannot be contrary to the Provision of the co-operative Societies Act. The bye-laws generally include the following clauses for internal management of co-operative society.
• Name and address of company
• Area of operation
• The manner in which and the limit up to which the funds of the society should be raised.
• Objects of society
• Maximum amount of share capital that my held by a member
• Terms and qualifications for admission of membership
• Rights, duties and liabilities of members.
• Maximum loan admissible to a member.
Disposal of net profit
• Rule no. 8 Maharashtra state Co-operative Societies Rule,1961 give the various details of the items in the bye-laws of the society.
• Any amendments, changes or deletion in bye-laws shall have to be approved by a resolution at special general meeting and also a written approval from the District Deputy Registrar is necessary.
• The first bye-laws of the society are required to be approved by the Registrar, as per Rule no.9.
Q14) What is Co-operative year under MCS Act?
A14) The Act has fixed 31st day of March as the day of balancing the accounts of the society. However, any other day can be fixed by the society for this purpose with the prior approval of the registrar. It means that the co-operative year need not necessarily be from 1st April to 31st March. Normally, now a days societies follow 31st March as the year ending to conform with the Income Tax Act.
Q15) What are Members under MCS Act?
A15) Under section 2(19), a member of a co-operative society means a person joining in an application for the registration of a co-operative society, which is subsequently registered or a person duly admitted to a member. Following are the different types of members-
• Associate Member: Associate member means a member who hold jointly a share of society with others, but whose name does not stand first in share certificate.
• Nominal Member: ‘Nominal Member ‘means a person admitted to membership as such after registration in accordance with its laws.
• Sympathiser Member: Sympathiser member means a person who sympathises with aims and objects of the society and who is admitted by society as such manner.
Q16) Give the classifications of Consumers co-operative society?
A16) Consumers co-operative society can be classified as under:
a. Primary Consumers society:
Such societies meet needs of direct customers. The controller goods purchased from central stores to which affiliated and others in bulk purchases in open market and sales at reasonable price to members, in some cases to non-members also.
b. Central Whole Stores:
These types of society deal in whole-sale business, and fulfil the needs of primary society.
c. Departmental stores:
In cities super market / Departmental stores are set up which stock are requirement of consumers under one roof. These types of societies need substantial amount for capital.
Q17) What does Section 65(1) of the Act states?
A17) Section 65(1) of the Act, amended in 1985, states that a society shall construct its relevant annual financial statement and arrive at its consequent net profit or loss in the manner prescribed. A co-operative society engaged in a business of Manufacturing, Trading or Banking should adopt mercantile system of accounting to arrive at true and fair profits.
Q18) What does Section 65(2) of the Act states?
A18) Section 65(2) states that a society may appropriate its Net Profit to the reserve fund or any other fund for payment of dividend to members on their shares. No parts of the profits shall be appropriated except with the approval of the General Body.
Q19) What does Section 64 of the Act states?
A19) Section 64 of the Act states that no part of the funds other than the dividend equalisation or Bonus equalisation shall be paid by way to bonus or dividend to its members.
Q20) What does Section 68 of the Act states?
A20) According to section 68 every society shall contribute annually towards the Education Fund and Rule No.53 prescribes the rates of contribution according to the nature of society.
| Class of society | Rate |
1 | Primary Consumers Society | 2 Paise per Rs.100 of the working capital subject to a maximum of Rs.1,000. |
2 | Urban Credit Society | 10% of the working capital in respect of those which have earned |
|
| Profit during the previous year subject to maximum of Rs.500 |
3 | Co-operative Sugar Factories | 25 paise per ton of sugarcane crushed subject to maximum of Rs.25,000. |
4 | Housing Society Backward Class housing society | Re.1 per member having a tenement Rs.10. |
5 | Urban credit bank | 1/10% of working capital subject to a maximum of Rs.1,000. |
Unit 1
Final Accounts of Co-operative Societies
Q1) What do you mean by Co-operative society?
A1) Co-operative society came into existence due to the exploitation of the economically and socially weaker section of the society; by manufactures / big businesspersons / whole / Retailers.
The Co-operative movement first started in Europe; particularly in England and Germany.
When weaker section of society is finding out difficult with less earning; they were organised them self for mutual help. These organizations lead to firm a Co-operative society.
A Co-operative society can be defined as an association of people usually of a limited means, who have voluntarily joined the organisation making equitable contribution to the capital required and excepting a share and risks and benefits of the organisation. Normally a Co- operative society is a service organization is not interested in making profit.
A Co-operative society is most important form of organisation in Indian economic screen. Co-operative societies are covered by different state Laws which differs from state to state.
Co-operative societies as form of organisation doing the business are assuming a growing importance, next to corporate sector on the Indian economic sense. Co-operative Society is a collective effort of large number of people, operating in various fields of activities such as co- operative sugar factories, spinning and weaving mills, co-operative credit societies, Urban co- operative Banks, consumers co-operative societies, Industrial co-operative societies, housing societies and so on.
Q2) Discuss the allocation of profit as per Maharashtra State Co-operative Societies Act?
A2) Maharashtra is the second most populated state in India, and therefore, a Maharashtra Cooperatives Society Act is just the right fit for the state. With its population, it is not a shock that there are over 5 crore members to the existing nearly two lakh cooperative societies. Cooperative housing societies are a part of the cooperative societies and are governed by the Maharashtra Cooperative Societies Act 1960 (latest Maharashtra cooperative Societies Act 2019). The MCS Act 1960 was brought into action on 26 January 1962. A few amends were made to the Maharashtra Cooperative Housing Society Act (as the centre mandated) on 13 February 2013. The amends of the Maharashtra Cooperative Society rules came into action the very next day i.e., 14 February 2013.
The Maharashtra Cooperative Societies Act or the Maharashtra Housing Society Act 1960 states its key features based on better housing plans for its people. It provides an inclusive and easy registration system, membership perks and includes the privileges and duties offered all over Maharashtra. The Maharashtra Cooperative Act aims to provide a fair system and solutions in Maharashtra for cooperative societies.
Under the Maharashtra Cooperative Housing Society Act 1960, the main purpose is to offer/provide its members with better housing opportunities such as open flats, apartments, and plots. In addition to this, it also aims at providing its members with the luxury of basic amenities.
In Maharashtra Co-op movements, give way to Co-op. Sugar Factories, Left Irrigation, and Co-op Housing Society. A Co-operating society is a voluntary organisation formed for the purpose of promoting & protecting interest of its members. The main objective of Co-operative society is to protecting interest of its members. It does earn profit which may be partly distributed among its members and partly kept as reserves.
Maharashtra is considered as a most progressive state in the development of Co-operative Societies. The Accounting Procedures and Final Accounts Formats differ from state to state as each state in India has its own Co-operative Act. Let us study the main provisions of the Maharashtra Co- operative Societies (MCS) Act, 1960 and the Maharashtra State Co-operative Societies Rules, 1961.
Q3) Define Co-operative society and working capital under MCS Act?
A3) Under section 2(27) of the Act, Society means a co-operative society registered or deemed to be registered under this Act. Co-operative society is corporate body distinct from its members. Section 167 of Co-operative Societies Act state that provisions of Companies Act are not applicable to Co-operatives.
Working Capital: Under section 2(31) of the Act, ‘Working Capital ‘means funds at the disposal of society inclusive of paid-up share capital, funds build up out of profits and money raised by borrowing and other means. The definition of the term is different as generally working capital means Net Current Assets represented by Current Assets Less Current Liabilities.
Q4) What are the types of the Maharashtra Co-operative societies?
A4) The Maharashtra Co-operative Societies Act classifies societies under various categories as under:
(1) Credit Co-operative Society:
This is oldest type of co-operative in India. It comes into existence around 1904 with the passing of co-operative societies Act 1904.
The main purpose of this type of societies is to provide loans to members, at low rate of interest.
(2) Consumers co-operative society:
Consumers form it. The consumers co-operative society purchases in bulk and in large quantities and sells it to members / to consumers at reasonable prices and also good quality. Therefore, consumers co-operative society eliminate intermediaries between buyers and sellers / manufacturers.
(3) Industrial Co-operative Society:
It is organised by small producers to carry out certain production activities e.g., sugar mills / milk / cotton cloths co- operative societies.
(4) Agricultural Marketing Society:
It means that a society which is marketing agricultural produce ii) At least ¾ of its member are agriculturist.
(5) Co-operative Bank:
For doing banking business as per section 5 of Bank Companies Act. / For doing Banking business permission of R.B.I. Required.
(6) Co-operative Housing Societies:
These types of societies are formed for the purpose providing to its members dwelling houses or flats acquired by its members with common amenities and services. In Maharashtra house construction activities are regulated by Maharashtra Ownership Flat Act, 1963.
(7) Apex society
(8) Central Bank
(9) Farming society
(10) Crop protection society
(11) Federal society:
It is a society which has not less than five members are societies and has also regulated 80% of voting rights is held by co-operative societies.
(12) Lift Irrigation society.
Q5) Explain Ascertainment and Appropriation of profits under section 65?
A5) A society shall construct its relevant annual financial statements and arrive at its consequent net profit or loss in the manner prescribed.
A society may appropriate [its net profits] to the reserve fund or any other fund to payment of dividends to members on their shares to the payment of bonus on the basis of support received from members and persons who are not members to its business, to payment of honoraria and towards any other purpose which may be specified in the rules or bye-laws:
Provided that no part of the profits shall be appropriated except with the approval of the annual general meeting and in conformity with the Act, rules and bye-laws.
1. Section 65(1) of the Act, amended in 1985, states that a society shall construct its relevant annual financial statement and arrive at its consequent net profit or loss in the manner prescribed. A co-operative society engaged in a business of Manufacturing, Trading or Banking should adopt mercantile system of accounting to arrive at true and fair profits. The
2. Section 65(2) states that a society may appropriate its Net Profit to the reserve fund or any other fund for payment of dividend to members on their shares. No parts of the profits shall be appropriated except with the approval of the General Body.
3. Section 64 of the Act states that no part of the funds other than the dividend equalisation or Bonus equalisation shall be paid by way to bonus or dividend to its members.
4. According to section 68 every society shall contribute annually towards the Education Fund and Rule No.53 prescribes the rates of contribution according to the nature of society.
| Class of society | Rate |
1 | Primary Consumers Society | 2 Paise per Rs.100 of the working capital subject to a maximum of Rs.1,000. |
2 | Urban Credit Society | 10% of the working capital in respect of those which have earned |
|
| Profit during the previous year subject to maximum of Rs.500 |
3 | Co-operative Sugar Factories | 25 paise per ton of sugarcane crushed subject to maximum of Rs.25,000. |
4 | Housing Society Backward Class housing society | Re.1 per member having a tenement Rs.10. |
5 | Urban credit bank | 1/10% of working capital subject to a maximum of Rs.1,000. |
Q6) State the format of Income and expenditure account.
A6)
FORMAT OF INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes |
|
| -Property Expenses |
|
|
Water Charges |
|
|
|
|
|
Common Electricity charges |
|
|
|
|
|
Repairs & Maintenance |
|
|
|
|
|
Insurance charges |
|
| II. Collection from Members for |
|
|
Club House Expenses |
|
| -Establishment Expenses |
|
|
II. Establishment Expenses |
|
|
|
|
|
Salaries |
|
|
|
|
|
Office Expenses |
|
|
|
|
|
Accounting charges |
|
|
|
|
|
Printing & Stationery |
|
|
|
|
|
Conveyance |
|
|
|
|
|
Election Fund |
|
| III. Interest & Dividend |
|
|
Subscriptions of Hsg Federation |
|
| Interest on Savings Bank |
|
|
Audit Fees |
|
| Interest on Fixed Deposits |
|
|
Security Charges |
|
| Interest on Investments |
|
|
Salaries |
|
| Dividend on Shares/MF |
|
|
III. Other Expenses |
|
|
|
|
|
Depreciation |
|
| IV. Other Income |
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
| Total |
|
|
Q7) Prepare the format of balance sheet.
A7) FORMAT OF Balance Sheet
Liabilities | Amount | Assets | Amount |
Share Capital |
| Cash & Bank Balance |
|
Authorized, Issued and Paid- Up |
| Cash in hand |
|
Purchased by the Government |
| At Bank (also called Deposits) |
|
Purchased by Co-operative Societies |
| Investments |
|
Purchased by Individuals |
| Government Securities |
|
Shares in Advance |
| Shares in Co-operative Institution |
|
Less: Calls in Arrears |
| Fixed Deposits with Banks |
|
Add: Calls in Advance |
| Provident Fund Investments |
|
Subscription/Deposits Towards shares |
| (Including advances to provident Fund) |
|
Reserve Fund and Other Funds |
| Loans and Advances |
|
Reserve Fund |
| Loans |
|
Building Fund |
| Cash Credit |
|
Development Fund |
| DuefromtheManaging Committee |
|
Reserve for Doubtful Debts |
| Sundry Debtors |
|
Depreciation Fund |
| For Credit Sales |
|
Dividend Fund |
| For Advances |
|
Bonus Equalization Fund |
| Current Assets |
|
Other Equalization Fund |
| Tools and Equipment’s |
|
Staff Provident Fund |
| Closing Stock |
|
Debentures |
| Work in Progress |
|
Cash credit |
| Fixed Assets |
|
Overdraft |
| Land and Building |
|
Loans |
| Plant and Machinery |
|
Government Loans |
| Live stocks |
|
Other secured Loans |
| Dead socks |
|
Secured Loans |
| Vehicles |
|
Unsecured Loans |
| Other Expenses and Losses |
|
From Banks |
| (Not written off) |
|
From Government |
| Preliminary Expenses |
|
Bills payable |
| Advances |
|
Others |
| Payment of Taxes |
|
Deposits |
| Goodwill |
|
Fixed Deposits |
| Deferred Revenue Expenses |
|
Saving Deposits |
| Expenses in connection with issue Of Debentures |
|
Recurring Deposits |
| Losses |
|
Other Deposits |
| Add: Current Loss |
|
CurrentLiabilitiesand Provisions |
|
|
|
Sundry Liabilities |
|
|
|
Outstanding Salaries etc. |
|
|
|
Advances |
|
|
|
Unclaimed Dividend |
|
|
|
Interest due but not paid |
|
|
|
Other Liabilities |
|
|
|
Income & Expenditure account |
|
|
|
Opening Balance |
|
|
|
Add: Current Year Profit |
|
|
|
|
|
|
|
Total |
| Total |
|
Q8) From the following trail balance, prepare final accounts in the prescribed format.
Roshni Co-Op Housing Society Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 3,995 | Collection from Members |
|
Cash at Bank | 93,144 | -For Property Expenses | 37,056 |
Dues from Members | 52,903 | -For Service Charges | 5,140 |
Water pump | 4,113 | Members Deposit | 7,100 |
Deposits for Electricity | 595 | Interest- FD | 3,017 |
Deposits for Water | 380 | Interest- SB | 1,005 |
Property taxes | 10,346 | Sinking Fund (Bal b/d) | 34,560 |
Water Charges | 7,513 | Statutory Reserve Fund (Bal b/d) | 38,470 |
Common Electricity Charges | 10,240 | Subscribed Share Capital |
|
Subscriptions to Election Fund | 36 | 60 shares of Rs 50 each | 3,000 |
Office Expenses | 3,425 | Surplus for last year | 74,038 |
Printing & Postage | 776 |
|
|
Conveyance | 570 |
|
|
Subscriptions to Housing Federation | 500 |
|
|
Audit Fees | 1,000 |
|
|
Security Charges | 13,850 |
|
|
|
|
|
|
Total | 203,386 | Total | 203,386 |
|
|
|
|
Additional Information:
- Authorised share Capital is 2,000 shares of Rs 50 each
- Depreciation on water pump @ 15%
- Collection from Members for Service Charges include
- Entrance fees Rs 100
- Contribution for sinking fund Rs 1,440
A8)
Roshni Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes | 10,346 |
| -Property Expenses |
| 37,056 |
Water Charges | 7,513 |
|
|
|
|
Common Electricity charges | 10,240 | 28,099 |
|
|
|
|
|
|
|
|
|
|
|
| II. Collection from Members for |
|
|
|
|
| -Establishment Expenses |
|
|
II. Establishment Expenses |
|
| Vide Trial Balance | 5,140 |
|
Office Expenses | 3,425 |
| Less: Entrance Fees | (100) |
|
Printing & Postage | 776 |
| Less: Sinking Fund | (1,440) | 3,600 |
Conveyance | 570 |
|
|
|
|
Election Fund | 36 |
| III. Interest & Dividend |
|
|
Subscriptions of Hsg Federation | 500 |
|
|
|
|
Audit Fees | 1,000 |
| Interest SB | 1,005 |
|
Security Charges | 13,850 | 20,157 | Interest FD | 3,017 | 4,022 |
|
|
|
|
|
|
III. Other Expenses |
|
|
|
|
|
Depreciation |
| 617 | IV. Other Income |
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
| (4,195) |
|
|
|
|
|
|
|
|
|
Total |
| 44,678 | Total |
| 44,678 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 3,995 |
|
2000 shares of Rs 50 each |
| 1,00,000 | At Bank (also called Deposits) | 93,144 | 97,139 |
Subscribed |
|
| Investments |
| - |
60 shares of Rs 50 each |
| 3,000 | Provident Fund Investments |
| - |
Subscription/Deposits Towards shares |
| - | (Including advances to provident Fund) |
|
|
Reserve Fund and Other Funds |
|
| Loans and Advances |
| - |
Statutory Reserve Fund |
|
| Sundry Debtors |
|
|
Opening Less: Entrance Fees | 38,470 100 | 38,570 | Dues from Members |
| 52,903 |
Sinking Fund |
|
|
|
|
|
Opening Additions to SF | 34,560 1,440 | 36,000 | Current Assets |
| - |
|
|
| Fixed Assets |
|
|
Staff Provident Fund |
| - | Water Pump | 4,113 |
|
Secured Loans |
| - | Less: Depreciation | (617) | 3,496 |
Unsecured Loans |
| - | (4113 x 15%) |
|
|
Deposits |
|
|
|
|
|
Members Deposits |
| 7,100 |
|
|
|
Current Liabilities and Provisions |
| - | Other Expenses and Losses |
| - |
Unclaimed Dividend |
| - | Other Assets |
|
|
Interest due but not paid |
| - | Deposits for Electricity | 595 |
|
Other Liabilities |
| - | Deposits for Water | 380 | 975 |
Income & Expenditure account |
|
|
|
|
|
Opening Balance | 74,038 |
|
|
|
|
Less: Current Year Deficit | (4,195) | 69,843 |
|
|
|
|
|
|
|
|
|
Total |
| 1,54,513 | Total |
| 1,54,513 |
Q9) The following trial balance as on 31-3-18, prepare final accounts in the prescribed format.
Venkat Park Co-Op Housing Society Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 5,443 | Collection from Members |
|
Cash at Bank | 351,595 | -For Property Expenses | 86,662 |
Accounting Charges | 5,000 | -For Establishment Charges | 23,040 |
Accumulated losses not w/off | 262,532 | Entrance Fees | 170 |
Audit Fees | 750 | Interest- FD | 44,503 |
BMC Deposit for Water | 1,664 | Interest- SB | 10,750 |
BSES Deposit | 1,195 | Redevelopment charges | 300,000 |
Clubhouse Expenses | 35,020 | Statutory Reserve Fund (Bal b/d) | 399,773 |
Electricity Charges | 18,070 | Subscribed Share Capital |
|
Dues from Members | 83,817 | 60 shares of Rs 50 each | 3,000 |
Insurance Charges | 14,615 | Transfer Fees | 90 |
Structural Audit Fees | 14,750 | Outstanding Expenses | 9,950 |
Postage | 1,679 |
|
|
Property Taxes | 9,410 |
|
|
Repairs & maintenance | 49,723 |
|
|
Salaries | 6,000 |
|
|
Conveyance | 500 |
|
|
Water Charges | 16,175 |
|
|
|
|
|
|
|
|
|
|
Total | 877,938 | Total | 877,938 |
|
|
|
|
Additional Information:
- Authorised share Capital is 2,000 shares of Rs 50 each
- Prepaid Insurance Rs 11242
- Redevelopment charges collected from members to be refunded to members.
A9)
Venkat Park Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes |
| 9,410 | -Property Expenses |
| 86,662 |
Water Charges |
| 16,175 |
|
|
|
Electricity charges |
| 18,070 | II. Collection from Members for |
|
|
Repairs & Maintenance |
| 49,723 | -Establishment Expenses |
| 23,040 |
Insurance Charges | 14,615 |
|
|
|
|
Less: Prepaid | (11,242) | 3,373 |
|
|
|
Club House Expenses |
| 35,020 |
|
|
|
II. Establishment Expenses |
|
| III. Interest & Dividend |
|
|
Accounting charges | 5,000 |
|
|
|
|
Postage | 1,679 |
| Interest SB | 10,750 |
|
Conveyance | 500 |
| Interest FD | 44,503 | 55,253 |
Salaries | 6,000 |
|
|
|
|
Audit Fees | 750 |
| IV. Other Income |
|
|
Structural Audit Fees | 14,750 | 28,679 |
|
|
|
|
|
|
|
|
|
III. Other Expenses |
|
|
|
|
|
IV. Surplus/(Deficit) |
| 4,505 |
|
|
|
|
|
|
|
|
|
Total |
| 1,64,955 | Total |
| 1,64,955 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 5,443 |
|
2000 shares of Rs 50 each |
| 1,00,000 | At Bank (also called Deposits) | 3,51,595 | 3,57,038 |
Subscribed |
|
| Investments |
| - |
60 shares of Rs 50 each |
| 3,000 | Provident Fund Investments |
| - |
Subscription/Deposits Towards shares |
| - | (Including advances to provident Fund) |
|
|
Reserve Fund and Other Funds |
|
| Loans and Advances |
|
|
Statutory Reserve Fund |
|
| Prepaid Insurance |
| 11,242 |
Opening | 3,99,773 |
| Sundry Debtors |
|
|
Add: Entrance Fees | 170 |
| Dues from Members |
| 83,817 |
Add: Transfer Fees | 90 | 4,00,033 | Current Assets |
| - |
|
|
| Fixed Assets |
| - |
Staff Provident Fund |
| - | Other Expenses and Losses |
| - |
Secured Loans |
| - |
|
|
|
Unsecured Loans |
| - |
|
|
|
Deposits |
| - | Other Assets |
|
|
|
|
| BSES Deposit | 1,195 |
|
Current Liabilities and Provisions |
|
| BMC Deposit for Water | 1,664 | 2,859 |
Outstanding Expenses | 9,950 |
|
|
|
|
Redevelopment charges refundable | 3,00,000 | 3,09,950 | Income & Expenditure account |
|
|
Unclaimed Dividend |
| - |
|
|
|
Interest due but not paid |
| - | Opening Balance (Accumulated Losses) | 2,62,532 |
|
Other Liabilities |
| - | Less: Current Year Surplus | (4,505) | 2,58,027 |
Income & Expenditure account |
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
| 7,12,983 | Total |
| 7,12,983 |
Q10) From the following trail balance, prepare final accounts in the prescribed format.
Shark CHS Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 14,984 | Collection from Members |
|
Cash at Bank | 2,36,071 | -For Property Expenses | 16,99,152 |
Water Pump | 12,390 | -For Establishment Charges | 11,57,017 |
Fixed Deposits | 61,37,752 | Entrance Fees | 200 |
Audit Fees | 17,524 | Interest on sinking fund investment | 7,61,946 |
BMC Deposit for Water | 6,625 | Interest- SB | 1,212 |
Tata Power Deposit | 14,200 | Redevelopment charges |
|
Fixed Deposits- Sinking Fund | 26,90,000 | Statutory Reserve Fund (Bal b/d) | 1,35,515 |
Electricity Charges | 3,41,324 | Subscribed Share Capital |
|
Dues from Members | 60,236 | 350 shares of Rs 50 each | 17,500 |
Insurance Charges | 27,695 | Transfer Fees | 500 |
Equipment’s | 3,90,256 | Surplus for last year | 6,19,986 |
Furniture & Fittings | 11,718 | Tower Rent | 1,96,542 |
Property Taxes | 5,89,710 | Sinking Fund (Bal b/d) | 67,12,745 |
Repairs & maintenance | 1,40,616 | Collected for Sinking Fund | 5,71,596 |
Salaries | 6,75,783 |
|
|
Security charges | 1,31,952 |
|
|
Water Charges | 1,30,485 |
|
|
Accrued Interest FD- Sinking Fund | 70,299 |
|
|
Housekeeping Exps | 1,48,310 |
|
|
Advances Staff | 26,081 |
|
|
Additional Information:
- Authorised share Capital is 28,000 shares of Rs 50 each
- Provide Depreciation
- Equipment’sRs 71,996
- Water PumpRs 1,858
- FurnitureRs 1,172
3. Prepaid Insurance Rs 13,660
4. Prepaid Maintenance Rs 15,571
5. O/s Property Taxes Rs 5,97,603
6. Advance from members for service charges Rs 30,181
7. Tower rent received in advance Rs 44,065.
A10)
Shark Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes | 5,89,710 |
| -Property Expenses |
| 16,99,152 |
Add: O/s Property Taxes | 5,97,603 | 11,87,313 |
|
|
|
Water Charges |
| 1,30,485 |
|
|
|
Electricity charges |
| 3,41,324 |
|
|
|
Repairs & Maintenance | 1,40,616 |
|
|
|
|
Less: Prepaid | (15,571) | 1,25,045 | II. Collection from Members for |
|
|
|
|
| -Establishment Expenses | 11,57,017 |
|
Insurance Charges | 27,695 |
| Less: Advance | (30,181) | 11,26,836 |
Less: Prepaid | (13,660) | 14,035 |
|
|
|
|
|
|
|
|
|
II. Establishment Expenses |
|
| III. Interest & Dividend |
|
|
Housekeeping | 1,48,310 |
|
|
|
|
Security | 1,31,952 |
| Interest SB |
| 1,212 |
Salaries | 6,75,783 |
|
|
|
|
Audit Fees | 17,524 |
|
|
|
|
III. Other Expenses |
|
| IV. Other Income |
|
|
Depreciation |
|
| Tower Rent | 1,96,642 |
|
Equipment’s | 71,996 |
| Less: Advance | (44,065) | 1,52,577 |
Water Pump | 1,858 |
|
|
|
|
Furniture | 1,172 | 75,026 |
|
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
| 1,32,980 |
|
|
|
|
|
|
|
|
|
Total |
| 29,79,777 | Total |
| 29,79,777 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 14,984 |
|
28000 shares of Rs 50 each |
| 14,00,000 | At Bank (also called Deposits) | 2,36,071 | 2,51,055 |
Subscribed |
|
| Investments |
|
|
350 shares of Rs 50 each |
| 17,500 | Fixed Deposits | 61,37,752 |
|
Subscription/Deposits Towards shares |
| - | Fixed Deposits SF | 26,90,000 |
|
Reserve Fund and Other Funds |
|
| Add: Accrued Interest | 70,299 | 88,98,051 |
Statutory Reserve Fund |
|
| Provident Fund Investments |
| - |
Opening | 1,35,515 |
| (Including advances to provident Fund) |
|
|
Add: Entrance Fees | 200 |
| Loans and Advances |
|
|
Add: Transfer Fees | 500 | 1,36,215 | Prepaid Insurance | 13,660 |
|
Sinking Fund |
|
| Prepaid Maintenance | 15,571 | 29,281 |
Opening | 67,12,745 |
| Sundry Debtors |
|
|
Addition | 5,71,596 |
| Dues from Members | 60,236 |
|
Interest on SF FD | 7,61,946 | 80,46,287 | Advances- Staff | 26,081 | 86,317 |
|
|
| Current Assets |
|
|
Staff Provident Fund |
| - | Fixed Assets |
|
|
Secured Loans |
| - | Equipment’s | 3,90,256 |
|
Unsecured Loans |
| - | Less: Depreciation | (71,996) | 3,18,260 |
Deposits |
| - | Furniture | 11,718 |
|
Current Liabilities and Provisions |
|
| Less: Depreciation | (1,172) | 10,546 |
Outstanding Expenses | 5,97,603 |
| Water Pump | 12,390 |
|
Advance from Members | 30,181 |
| Less: Depreciation | (1,858) | 10,532 |
Income received in advance | 44,065 | 6,71,849 |
|
|
|
|
|
| Other Expenses and Losses |
|
|
Unclaimed Dividend |
| - | Other Assets |
|
|
Interest due but not paid |
| - | Tata Power Deposit | 14,200 |
|
Other Liabilities |
| - | BMC Deposit for Water | 6,625 | 20,825 |
Income & Expenditure account |
|
|
|
|
|
Surplus for last year | 6,19,986 |
| Income & Expenditure account |
|
|
Add: Current year surplus | 1,32,980 | 7,52,966 |
|
|
|
|
|
|
|
|
|
Total |
| 96,24,817 | Total |
| 96,24,817 |
Q11) Discuss Maharashtra Cooperative Societies Act 1960.
A11) The Maharashtra Cooperative Societies Act or the Maharashtra Housing Society Act 1960 states its key features based on better housing plans for its people. It provides an inclusive and easy registration system, membership perks and includes the privileges and duties offered all over Maharashtra. The Maharashtra Cooperative Act aims to provide a fair system and solutions in Maharashtra for cooperative societies.
Under the Maharashtra Cooperative Housing Society Act 1960, the main purpose is to offer/provide its members with better housing opportunities such as open flats, apartments, and plots. In addition to this, it also aims at providing its members with the luxury of basic amenities.
Q12) Define Auditor under MCS Act?
A12) Rule No.69 of Co-operative Societies Rules states that the audit co-operative societies shall be conducted either by departments auditor or certified auditors. The term certified auditors include the following:
• Chartered Accountant
• A person who holds a government diploma in Co-operative Accounts and Audit.
• A person who has served as an auditor in the co-operative department of the state government (Retired officers of the co-operative department.
Q13) What are Bye-laws under MCS Act?
A13) Under section 2(5) ‘Bye-laws ‘registered under this Act and for the time being in force, and includes registered amendments of such bye-laws. Bye-laws of a co-operative society may be compared with the articles of a company.
The Provision in the bye-laws cannot be contrary to the Provision of the co-operative Societies Act. The bye-laws generally include the following clauses for internal management of co-operative society.
• Name and address of company
• Area of operation
• The manner in which and the limit up to which the funds of the society should be raised.
• Objects of society
• Maximum amount of share capital that my held by a member
• Terms and qualifications for admission of membership
• Rights, duties and liabilities of members.
• Maximum loan admissible to a member.
Disposal of net profit
• Rule no. 8 Maharashtra state Co-operative Societies Rule,1961 give the various details of the items in the bye-laws of the society.
• Any amendments, changes or deletion in bye-laws shall have to be approved by a resolution at special general meeting and also a written approval from the District Deputy Registrar is necessary.
• The first bye-laws of the society are required to be approved by the Registrar, as per Rule no.9.
Q14) What is Co-operative year under MCS Act?
A14) The Act has fixed 31st day of March as the day of balancing the accounts of the society. However, any other day can be fixed by the society for this purpose with the prior approval of the registrar. It means that the co-operative year need not necessarily be from 1st April to 31st March. Normally, now a days societies follow 31st March as the year ending to conform with the Income Tax Act.
Q15) What are Members under MCS Act?
A15) Under section 2(19), a member of a co-operative society means a person joining in an application for the registration of a co-operative society, which is subsequently registered or a person duly admitted to a member. Following are the different types of members-
• Associate Member: Associate member means a member who hold jointly a share of society with others, but whose name does not stand first in share certificate.
• Nominal Member: ‘Nominal Member ‘means a person admitted to membership as such after registration in accordance with its laws.
• Sympathiser Member: Sympathiser member means a person who sympathises with aims and objects of the society and who is admitted by society as such manner.
Q16) Give the classifications of Consumers co-operative society?
A16) Consumers co-operative society can be classified as under:
a. Primary Consumers society:
Such societies meet needs of direct customers. The controller goods purchased from central stores to which affiliated and others in bulk purchases in open market and sales at reasonable price to members, in some cases to non-members also.
b. Central Whole Stores:
These types of society deal in whole-sale business, and fulfil the needs of primary society.
c. Departmental stores:
In cities super market / Departmental stores are set up which stock are requirement of consumers under one roof. These types of societies need substantial amount for capital.
Q17) What does Section 65(1) of the Act states?
A17) Section 65(1) of the Act, amended in 1985, states that a society shall construct its relevant annual financial statement and arrive at its consequent net profit or loss in the manner prescribed. A co-operative society engaged in a business of Manufacturing, Trading or Banking should adopt mercantile system of accounting to arrive at true and fair profits.
Q18) What does Section 65(2) of the Act states?
A18) Section 65(2) states that a society may appropriate its Net Profit to the reserve fund or any other fund for payment of dividend to members on their shares. No parts of the profits shall be appropriated except with the approval of the General Body.
Q19) What does Section 64 of the Act states?
A19) Section 64 of the Act states that no part of the funds other than the dividend equalisation or Bonus equalisation shall be paid by way to bonus or dividend to its members.
Q20) What does Section 68 of the Act states?
A20) According to section 68 every society shall contribute annually towards the Education Fund and Rule No.53 prescribes the rates of contribution according to the nature of society.
| Class of society | Rate |
1 | Primary Consumers Society | 2 Paise per Rs.100 of the working capital subject to a maximum of Rs.1,000. |
2 | Urban Credit Society | 10% of the working capital in respect of those which have earned |
|
| Profit during the previous year subject to maximum of Rs.500 |
3 | Co-operative Sugar Factories | 25 paise per ton of sugarcane crushed subject to maximum of Rs.25,000. |
4 | Housing Society Backward Class housing society | Re.1 per member having a tenement Rs.10. |
5 | Urban credit bank | 1/10% of working capital subject to a maximum of Rs.1,000. |
Unit 1
Final Accounts of Co-operative Societies
Q1) What do you mean by Co-operative society?
A1) Co-operative society came into existence due to the exploitation of the economically and socially weaker section of the society; by manufactures / big businesspersons / whole / Retailers.
The Co-operative movement first started in Europe; particularly in England and Germany.
When weaker section of society is finding out difficult with less earning; they were organised them self for mutual help. These organizations lead to firm a Co-operative society.
A Co-operative society can be defined as an association of people usually of a limited means, who have voluntarily joined the organisation making equitable contribution to the capital required and excepting a share and risks and benefits of the organisation. Normally a Co- operative society is a service organization is not interested in making profit.
A Co-operative society is most important form of organisation in Indian economic screen. Co-operative societies are covered by different state Laws which differs from state to state.
Co-operative societies as form of organisation doing the business are assuming a growing importance, next to corporate sector on the Indian economic sense. Co-operative Society is a collective effort of large number of people, operating in various fields of activities such as co- operative sugar factories, spinning and weaving mills, co-operative credit societies, Urban co- operative Banks, consumers co-operative societies, Industrial co-operative societies, housing societies and so on.
Q2) Discuss the allocation of profit as per Maharashtra State Co-operative Societies Act?
A2) Maharashtra is the second most populated state in India, and therefore, a Maharashtra Cooperatives Society Act is just the right fit for the state. With its population, it is not a shock that there are over 5 crore members to the existing nearly two lakh cooperative societies. Cooperative housing societies are a part of the cooperative societies and are governed by the Maharashtra Cooperative Societies Act 1960 (latest Maharashtra cooperative Societies Act 2019). The MCS Act 1960 was brought into action on 26 January 1962. A few amends were made to the Maharashtra Cooperative Housing Society Act (as the centre mandated) on 13 February 2013. The amends of the Maharashtra Cooperative Society rules came into action the very next day i.e., 14 February 2013.
The Maharashtra Cooperative Societies Act or the Maharashtra Housing Society Act 1960 states its key features based on better housing plans for its people. It provides an inclusive and easy registration system, membership perks and includes the privileges and duties offered all over Maharashtra. The Maharashtra Cooperative Act aims to provide a fair system and solutions in Maharashtra for cooperative societies.
Under the Maharashtra Cooperative Housing Society Act 1960, the main purpose is to offer/provide its members with better housing opportunities such as open flats, apartments, and plots. In addition to this, it also aims at providing its members with the luxury of basic amenities.
In Maharashtra Co-op movements, give way to Co-op. Sugar Factories, Left Irrigation, and Co-op Housing Society. A Co-operating society is a voluntary organisation formed for the purpose of promoting & protecting interest of its members. The main objective of Co-operative society is to protecting interest of its members. It does earn profit which may be partly distributed among its members and partly kept as reserves.
Maharashtra is considered as a most progressive state in the development of Co-operative Societies. The Accounting Procedures and Final Accounts Formats differ from state to state as each state in India has its own Co-operative Act. Let us study the main provisions of the Maharashtra Co- operative Societies (MCS) Act, 1960 and the Maharashtra State Co-operative Societies Rules, 1961.
Q3) Define Co-operative society and working capital under MCS Act?
A3) Under section 2(27) of the Act, Society means a co-operative society registered or deemed to be registered under this Act. Co-operative society is corporate body distinct from its members. Section 167 of Co-operative Societies Act state that provisions of Companies Act are not applicable to Co-operatives.
Working Capital: Under section 2(31) of the Act, ‘Working Capital ‘means funds at the disposal of society inclusive of paid-up share capital, funds build up out of profits and money raised by borrowing and other means. The definition of the term is different as generally working capital means Net Current Assets represented by Current Assets Less Current Liabilities.
Q4) What are the types of the Maharashtra Co-operative societies?
A4) The Maharashtra Co-operative Societies Act classifies societies under various categories as under:
(1) Credit Co-operative Society:
This is oldest type of co-operative in India. It comes into existence around 1904 with the passing of co-operative societies Act 1904.
The main purpose of this type of societies is to provide loans to members, at low rate of interest.
(2) Consumers co-operative society:
Consumers form it. The consumers co-operative society purchases in bulk and in large quantities and sells it to members / to consumers at reasonable prices and also good quality. Therefore, consumers co-operative society eliminate intermediaries between buyers and sellers / manufacturers.
(3) Industrial Co-operative Society:
It is organised by small producers to carry out certain production activities e.g., sugar mills / milk / cotton cloths co- operative societies.
(4) Agricultural Marketing Society:
It means that a society which is marketing agricultural produce ii) At least ¾ of its member are agriculturist.
(5) Co-operative Bank:
For doing banking business as per section 5 of Bank Companies Act. / For doing Banking business permission of R.B.I. Required.
(6) Co-operative Housing Societies:
These types of societies are formed for the purpose providing to its members dwelling houses or flats acquired by its members with common amenities and services. In Maharashtra house construction activities are regulated by Maharashtra Ownership Flat Act, 1963.
(7) Apex society
(8) Central Bank
(9) Farming society
(10) Crop protection society
(11) Federal society:
It is a society which has not less than five members are societies and has also regulated 80% of voting rights is held by co-operative societies.
(12) Lift Irrigation society.
Q5) Explain Ascertainment and Appropriation of profits under section 65?
A5) A society shall construct its relevant annual financial statements and arrive at its consequent net profit or loss in the manner prescribed.
A society may appropriate [its net profits] to the reserve fund or any other fund to payment of dividends to members on their shares to the payment of bonus on the basis of support received from members and persons who are not members to its business, to payment of honoraria and towards any other purpose which may be specified in the rules or bye-laws:
Provided that no part of the profits shall be appropriated except with the approval of the annual general meeting and in conformity with the Act, rules and bye-laws.
1. Section 65(1) of the Act, amended in 1985, states that a society shall construct its relevant annual financial statement and arrive at its consequent net profit or loss in the manner prescribed. A co-operative society engaged in a business of Manufacturing, Trading or Banking should adopt mercantile system of accounting to arrive at true and fair profits. The
2. Section 65(2) states that a society may appropriate its Net Profit to the reserve fund or any other fund for payment of dividend to members on their shares. No parts of the profits shall be appropriated except with the approval of the General Body.
3. Section 64 of the Act states that no part of the funds other than the dividend equalisation or Bonus equalisation shall be paid by way to bonus or dividend to its members.
4. According to section 68 every society shall contribute annually towards the Education Fund and Rule No.53 prescribes the rates of contribution according to the nature of society.
| Class of society | Rate |
1 | Primary Consumers Society | 2 Paise per Rs.100 of the working capital subject to a maximum of Rs.1,000. |
2 | Urban Credit Society | 10% of the working capital in respect of those which have earned |
|
| Profit during the previous year subject to maximum of Rs.500 |
3 | Co-operative Sugar Factories | 25 paise per ton of sugarcane crushed subject to maximum of Rs.25,000. |
4 | Housing Society Backward Class housing society | Re.1 per member having a tenement Rs.10. |
5 | Urban credit bank | 1/10% of working capital subject to a maximum of Rs.1,000. |
Q6) State the format of Income and expenditure account.
A6)
FORMAT OF INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes |
|
| -Property Expenses |
|
|
Water Charges |
|
|
|
|
|
Common Electricity charges |
|
|
|
|
|
Repairs & Maintenance |
|
|
|
|
|
Insurance charges |
|
| II. Collection from Members for |
|
|
Club House Expenses |
|
| -Establishment Expenses |
|
|
II. Establishment Expenses |
|
|
|
|
|
Salaries |
|
|
|
|
|
Office Expenses |
|
|
|
|
|
Accounting charges |
|
|
|
|
|
Printing & Stationery |
|
|
|
|
|
Conveyance |
|
|
|
|
|
Election Fund |
|
| III. Interest & Dividend |
|
|
Subscriptions of Hsg Federation |
|
| Interest on Savings Bank |
|
|
Audit Fees |
|
| Interest on Fixed Deposits |
|
|
Security Charges |
|
| Interest on Investments |
|
|
Salaries |
|
| Dividend on Shares/MF |
|
|
III. Other Expenses |
|
|
|
|
|
Depreciation |
|
| IV. Other Income |
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
| Total |
|
|
Q7) Prepare the format of balance sheet.
A7) FORMAT OF Balance Sheet
Liabilities | Amount | Assets | Amount |
Share Capital |
| Cash & Bank Balance |
|
Authorized, Issued and Paid- Up |
| Cash in hand |
|
Purchased by the Government |
| At Bank (also called Deposits) |
|
Purchased by Co-operative Societies |
| Investments |
|
Purchased by Individuals |
| Government Securities |
|
Shares in Advance |
| Shares in Co-operative Institution |
|
Less: Calls in Arrears |
| Fixed Deposits with Banks |
|
Add: Calls in Advance |
| Provident Fund Investments |
|
Subscription/Deposits Towards shares |
| (Including advances to provident Fund) |
|
Reserve Fund and Other Funds |
| Loans and Advances |
|
Reserve Fund |
| Loans |
|
Building Fund |
| Cash Credit |
|
Development Fund |
| DuefromtheManaging Committee |
|
Reserve for Doubtful Debts |
| Sundry Debtors |
|
Depreciation Fund |
| For Credit Sales |
|
Dividend Fund |
| For Advances |
|
Bonus Equalization Fund |
| Current Assets |
|
Other Equalization Fund |
| Tools and Equipment’s |
|
Staff Provident Fund |
| Closing Stock |
|
Debentures |
| Work in Progress |
|
Cash credit |
| Fixed Assets |
|
Overdraft |
| Land and Building |
|
Loans |
| Plant and Machinery |
|
Government Loans |
| Live stocks |
|
Other secured Loans |
| Dead socks |
|
Secured Loans |
| Vehicles |
|
Unsecured Loans |
| Other Expenses and Losses |
|
From Banks |
| (Not written off) |
|
From Government |
| Preliminary Expenses |
|
Bills payable |
| Advances |
|
Others |
| Payment of Taxes |
|
Deposits |
| Goodwill |
|
Fixed Deposits |
| Deferred Revenue Expenses |
|
Saving Deposits |
| Expenses in connection with issue Of Debentures |
|
Recurring Deposits |
| Losses |
|
Other Deposits |
| Add: Current Loss |
|
CurrentLiabilitiesand Provisions |
|
|
|
Sundry Liabilities |
|
|
|
Outstanding Salaries etc. |
|
|
|
Advances |
|
|
|
Unclaimed Dividend |
|
|
|
Interest due but not paid |
|
|
|
Other Liabilities |
|
|
|
Income & Expenditure account |
|
|
|
Opening Balance |
|
|
|
Add: Current Year Profit |
|
|
|
|
|
|
|
Total |
| Total |
|
Q8) From the following trail balance, prepare final accounts in the prescribed format.
Roshni Co-Op Housing Society Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 3,995 | Collection from Members |
|
Cash at Bank | 93,144 | -For Property Expenses | 37,056 |
Dues from Members | 52,903 | -For Service Charges | 5,140 |
Water pump | 4,113 | Members Deposit | 7,100 |
Deposits for Electricity | 595 | Interest- FD | 3,017 |
Deposits for Water | 380 | Interest- SB | 1,005 |
Property taxes | 10,346 | Sinking Fund (Bal b/d) | 34,560 |
Water Charges | 7,513 | Statutory Reserve Fund (Bal b/d) | 38,470 |
Common Electricity Charges | 10,240 | Subscribed Share Capital |
|
Subscriptions to Election Fund | 36 | 60 shares of Rs 50 each | 3,000 |
Office Expenses | 3,425 | Surplus for last year | 74,038 |
Printing & Postage | 776 |
|
|
Conveyance | 570 |
|
|
Subscriptions to Housing Federation | 500 |
|
|
Audit Fees | 1,000 |
|
|
Security Charges | 13,850 |
|
|
|
|
|
|
Total | 203,386 | Total | 203,386 |
|
|
|
|
Additional Information:
- Authorised share Capital is 2,000 shares of Rs 50 each
- Depreciation on water pump @ 15%
- Collection from Members for Service Charges include
- Entrance fees Rs 100
- Contribution for sinking fund Rs 1,440
A8)
Roshni Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes | 10,346 |
| -Property Expenses |
| 37,056 |
Water Charges | 7,513 |
|
|
|
|
Common Electricity charges | 10,240 | 28,099 |
|
|
|
|
|
|
|
|
|
|
|
| II. Collection from Members for |
|
|
|
|
| -Establishment Expenses |
|
|
II. Establishment Expenses |
|
| Vide Trial Balance | 5,140 |
|
Office Expenses | 3,425 |
| Less: Entrance Fees | (100) |
|
Printing & Postage | 776 |
| Less: Sinking Fund | (1,440) | 3,600 |
Conveyance | 570 |
|
|
|
|
Election Fund | 36 |
| III. Interest & Dividend |
|
|
Subscriptions of Hsg Federation | 500 |
|
|
|
|
Audit Fees | 1,000 |
| Interest SB | 1,005 |
|
Security Charges | 13,850 | 20,157 | Interest FD | 3,017 | 4,022 |
|
|
|
|
|
|
III. Other Expenses |
|
|
|
|
|
Depreciation |
| 617 | IV. Other Income |
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
| (4,195) |
|
|
|
|
|
|
|
|
|
Total |
| 44,678 | Total |
| 44,678 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 3,995 |
|
2000 shares of Rs 50 each |
| 1,00,000 | At Bank (also called Deposits) | 93,144 | 97,139 |
Subscribed |
|
| Investments |
| - |
60 shares of Rs 50 each |
| 3,000 | Provident Fund Investments |
| - |
Subscription/Deposits Towards shares |
| - | (Including advances to provident Fund) |
|
|
Reserve Fund and Other Funds |
|
| Loans and Advances |
| - |
Statutory Reserve Fund |
|
| Sundry Debtors |
|
|
Opening Less: Entrance Fees | 38,470 100 | 38,570 | Dues from Members |
| 52,903 |
Sinking Fund |
|
|
|
|
|
Opening Additions to SF | 34,560 1,440 | 36,000 | Current Assets |
| - |
|
|
| Fixed Assets |
|
|
Staff Provident Fund |
| - | Water Pump | 4,113 |
|
Secured Loans |
| - | Less: Depreciation | (617) | 3,496 |
Unsecured Loans |
| - | (4113 x 15%) |
|
|
Deposits |
|
|
|
|
|
Members Deposits |
| 7,100 |
|
|
|
Current Liabilities and Provisions |
| - | Other Expenses and Losses |
| - |
Unclaimed Dividend |
| - | Other Assets |
|
|
Interest due but not paid |
| - | Deposits for Electricity | 595 |
|
Other Liabilities |
| - | Deposits for Water | 380 | 975 |
Income & Expenditure account |
|
|
|
|
|
Opening Balance | 74,038 |
|
|
|
|
Less: Current Year Deficit | (4,195) | 69,843 |
|
|
|
|
|
|
|
|
|
Total |
| 1,54,513 | Total |
| 1,54,513 |
Q9) The following trial balance as on 31-3-18, prepare final accounts in the prescribed format.
Venkat Park Co-Op Housing Society Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 5,443 | Collection from Members |
|
Cash at Bank | 351,595 | -For Property Expenses | 86,662 |
Accounting Charges | 5,000 | -For Establishment Charges | 23,040 |
Accumulated losses not w/off | 262,532 | Entrance Fees | 170 |
Audit Fees | 750 | Interest- FD | 44,503 |
BMC Deposit for Water | 1,664 | Interest- SB | 10,750 |
BSES Deposit | 1,195 | Redevelopment charges | 300,000 |
Clubhouse Expenses | 35,020 | Statutory Reserve Fund (Bal b/d) | 399,773 |
Electricity Charges | 18,070 | Subscribed Share Capital |
|
Dues from Members | 83,817 | 60 shares of Rs 50 each | 3,000 |
Insurance Charges | 14,615 | Transfer Fees | 90 |
Structural Audit Fees | 14,750 | Outstanding Expenses | 9,950 |
Postage | 1,679 |
|
|
Property Taxes | 9,410 |
|
|
Repairs & maintenance | 49,723 |
|
|
Salaries | 6,000 |
|
|
Conveyance | 500 |
|
|
Water Charges | 16,175 |
|
|
|
|
|
|
|
|
|
|
Total | 877,938 | Total | 877,938 |
|
|
|
|
Additional Information:
- Authorised share Capital is 2,000 shares of Rs 50 each
- Prepaid Insurance Rs 11242
- Redevelopment charges collected from members to be refunded to members.
A9)
Venkat Park Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes |
| 9,410 | -Property Expenses |
| 86,662 |
Water Charges |
| 16,175 |
|
|
|
Electricity charges |
| 18,070 | II. Collection from Members for |
|
|
Repairs & Maintenance |
| 49,723 | -Establishment Expenses |
| 23,040 |
Insurance Charges | 14,615 |
|
|
|
|
Less: Prepaid | (11,242) | 3,373 |
|
|
|
Club House Expenses |
| 35,020 |
|
|
|
II. Establishment Expenses |
|
| III. Interest & Dividend |
|
|
Accounting charges | 5,000 |
|
|
|
|
Postage | 1,679 |
| Interest SB | 10,750 |
|
Conveyance | 500 |
| Interest FD | 44,503 | 55,253 |
Salaries | 6,000 |
|
|
|
|
Audit Fees | 750 |
| IV. Other Income |
|
|
Structural Audit Fees | 14,750 | 28,679 |
|
|
|
|
|
|
|
|
|
III. Other Expenses |
|
|
|
|
|
IV. Surplus/(Deficit) |
| 4,505 |
|
|
|
|
|
|
|
|
|
Total |
| 1,64,955 | Total |
| 1,64,955 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 5,443 |
|
2000 shares of Rs 50 each |
| 1,00,000 | At Bank (also called Deposits) | 3,51,595 | 3,57,038 |
Subscribed |
|
| Investments |
| - |
60 shares of Rs 50 each |
| 3,000 | Provident Fund Investments |
| - |
Subscription/Deposits Towards shares |
| - | (Including advances to provident Fund) |
|
|
Reserve Fund and Other Funds |
|
| Loans and Advances |
|
|
Statutory Reserve Fund |
|
| Prepaid Insurance |
| 11,242 |
Opening | 3,99,773 |
| Sundry Debtors |
|
|
Add: Entrance Fees | 170 |
| Dues from Members |
| 83,817 |
Add: Transfer Fees | 90 | 4,00,033 | Current Assets |
| - |
|
|
| Fixed Assets |
| - |
Staff Provident Fund |
| - | Other Expenses and Losses |
| - |
Secured Loans |
| - |
|
|
|
Unsecured Loans |
| - |
|
|
|
Deposits |
| - | Other Assets |
|
|
|
|
| BSES Deposit | 1,195 |
|
Current Liabilities and Provisions |
|
| BMC Deposit for Water | 1,664 | 2,859 |
Outstanding Expenses | 9,950 |
|
|
|
|
Redevelopment charges refundable | 3,00,000 | 3,09,950 | Income & Expenditure account |
|
|
Unclaimed Dividend |
| - |
|
|
|
Interest due but not paid |
| - | Opening Balance (Accumulated Losses) | 2,62,532 |
|
Other Liabilities |
| - | Less: Current Year Surplus | (4,505) | 2,58,027 |
Income & Expenditure account |
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
| 7,12,983 | Total |
| 7,12,983 |
Q10) From the following trail balance, prepare final accounts in the prescribed format.
Shark CHS Ltd
Trial Balance
Particulars | Debit (Rs) | Particulars | Credit (Rs) |
Cash in Hand | 14,984 | Collection from Members |
|
Cash at Bank | 2,36,071 | -For Property Expenses | 16,99,152 |
Water Pump | 12,390 | -For Establishment Charges | 11,57,017 |
Fixed Deposits | 61,37,752 | Entrance Fees | 200 |
Audit Fees | 17,524 | Interest on sinking fund investment | 7,61,946 |
BMC Deposit for Water | 6,625 | Interest- SB | 1,212 |
Tata Power Deposit | 14,200 | Redevelopment charges |
|
Fixed Deposits- Sinking Fund | 26,90,000 | Statutory Reserve Fund (Bal b/d) | 1,35,515 |
Electricity Charges | 3,41,324 | Subscribed Share Capital |
|
Dues from Members | 60,236 | 350 shares of Rs 50 each | 17,500 |
Insurance Charges | 27,695 | Transfer Fees | 500 |
Equipment’s | 3,90,256 | Surplus for last year | 6,19,986 |
Furniture & Fittings | 11,718 | Tower Rent | 1,96,542 |
Property Taxes | 5,89,710 | Sinking Fund (Bal b/d) | 67,12,745 |
Repairs & maintenance | 1,40,616 | Collected for Sinking Fund | 5,71,596 |
Salaries | 6,75,783 |
|
|
Security charges | 1,31,952 |
|
|
Water Charges | 1,30,485 |
|
|
Accrued Interest FD- Sinking Fund | 70,299 |
|
|
Housekeeping Exps | 1,48,310 |
|
|
Advances Staff | 26,081 |
|
|
Additional Information:
- Authorised share Capital is 28,000 shares of Rs 50 each
- Provide Depreciation
- Equipment’sRs 71,996
- Water PumpRs 1,858
- FurnitureRs 1,172
3. Prepaid Insurance Rs 13,660
4. Prepaid Maintenance Rs 15,571
5. O/s Property Taxes Rs 5,97,603
6. Advance from members for service charges Rs 30,181
7. Tower rent received in advance Rs 44,065.
A10)
Shark Co-Op Housing Society Ltd
INCOME & EXPENDITURE ACCOUNT
Particulars | Rs | Rs | Particulars | Rs | Rs |
I. Property Expenses |
|
| I. Collection from Members for |
|
|
Property Taxes | 5,89,710 |
| -Property Expenses |
| 16,99,152 |
Add: O/s Property Taxes | 5,97,603 | 11,87,313 |
|
|
|
Water Charges |
| 1,30,485 |
|
|
|
Electricity charges |
| 3,41,324 |
|
|
|
Repairs & Maintenance | 1,40,616 |
|
|
|
|
Less: Prepaid | (15,571) | 1,25,045 | II. Collection from Members for |
|
|
|
|
| -Establishment Expenses | 11,57,017 |
|
Insurance Charges | 27,695 |
| Less: Advance | (30,181) | 11,26,836 |
Less: Prepaid | (13,660) | 14,035 |
|
|
|
|
|
|
|
|
|
II. Establishment Expenses |
|
| III. Interest & Dividend |
|
|
Housekeeping | 1,48,310 |
|
|
|
|
Security | 1,31,952 |
| Interest SB |
| 1,212 |
Salaries | 6,75,783 |
|
|
|
|
Audit Fees | 17,524 |
|
|
|
|
III. Other Expenses |
|
| IV. Other Income |
|
|
Depreciation |
|
| Tower Rent | 1,96,642 |
|
Equipment’s | 71,996 |
| Less: Advance | (44,065) | 1,52,577 |
Water Pump | 1,858 |
|
|
|
|
Furniture | 1,172 | 75,026 |
|
|
|
|
|
|
|
|
|
IV. Surplus/(Deficit) |
| 1,32,980 |
|
|
|
|
|
|
|
|
|
Total |
| 29,79,777 | Total |
| 29,79,777 |
Balance Sheet
Liabilities | Amount | Amount | Assets | Amount | Amount |
Share Capital |
|
| Cash & Bank Balance |
|
|
Authorized |
|
| Cash in hand | 14,984 |
|
28000 shares of Rs 50 each |
| 14,00,000 | At Bank (also called Deposits) | 2,36,071 | 2,51,055 |
Subscribed |
|
| Investments |
|
|
350 shares of Rs 50 each |
| 17,500 | Fixed Deposits | 61,37,752 |
|
Subscription/Deposits Towards shares |
| - | Fixed Deposits SF | 26,90,000 |
|
Reserve Fund and Other Funds |
|
| Add: Accrued Interest | 70,299 | 88,98,051 |
Statutory Reserve Fund |
|
| Provident Fund Investments |
| - |
Opening | 1,35,515 |
| (Including advances to provident Fund) |
|
|
Add: Entrance Fees | 200 |
| Loans and Advances |
|
|
Add: Transfer Fees | 500 | 1,36,215 | Prepaid Insurance | 13,660 |
|
Sinking Fund |
|
| Prepaid Maintenance | 15,571 | 29,281 |
Opening | 67,12,745 |
| Sundry Debtors |
|
|
Addition | 5,71,596 |
| Dues from Members | 60,236 |
|
Interest on SF FD | 7,61,946 | 80,46,287 | Advances- Staff | 26,081 | 86,317 |
|
|
| Current Assets |
|
|
Staff Provident Fund |
| - | Fixed Assets |
|
|
Secured Loans |
| - | Equipment’s | 3,90,256 |
|
Unsecured Loans |
| - | Less: Depreciation | (71,996) | 3,18,260 |
Deposits |
| - | Furniture | 11,718 |
|
Current Liabilities and Provisions |
|
| Less: Depreciation | (1,172) | 10,546 |
Outstanding Expenses | 5,97,603 |
| Water Pump | 12,390 |
|
Advance from Members | 30,181 |
| Less: Depreciation | (1,858) | 10,532 |
Income received in advance | 44,065 | 6,71,849 |
|
|
|
|
|
| Other Expenses and Losses |
|
|
Unclaimed Dividend |
| - | Other Assets |
|
|
Interest due but not paid |
| - | Tata Power Deposit | 14,200 |
|
Other Liabilities |
| - | BMC Deposit for Water | 6,625 | 20,825 |
Income & Expenditure account |
|
|
|
|
|
Surplus for last year | 6,19,986 |
| Income & Expenditure account |
|
|
Add: Current year surplus | 1,32,980 | 7,52,966 |
|
|
|
|
|
|
|
|
|
Total |
| 96,24,817 | Total |
| 96,24,817 |
Q11) Discuss Maharashtra Cooperative Societies Act 1960.
A11) The Maharashtra Cooperative Societies Act or the Maharashtra Housing Society Act 1960 states its key features based on better housing plans for its people. It provides an inclusive and easy registration system, membership perks and includes the privileges and duties offered all over Maharashtra. The Maharashtra Cooperative Act aims to provide a fair system and solutions in Maharashtra for cooperative societies.
Under the Maharashtra Cooperative Housing Society Act 1960, the main purpose is to offer/provide its members with better housing opportunities such as open flats, apartments, and plots. In addition to this, it also aims at providing its members with the luxury of basic amenities.
Q12) Define Auditor under MCS Act?
A12) Rule No.69 of Co-operative Societies Rules states that the audit co-operative societies shall be conducted either by departments auditor or certified auditors. The term certified auditors include the following:
• Chartered Accountant
• A person who holds a government diploma in Co-operative Accounts and Audit.
• A person who has served as an auditor in the co-operative department of the state government (Retired officers of the co-operative department.
Q13) What are Bye-laws under MCS Act?
A13) Under section 2(5) ‘Bye-laws ‘registered under this Act and for the time being in force, and includes registered amendments of such bye-laws. Bye-laws of a co-operative society may be compared with the articles of a company.
The Provision in the bye-laws cannot be contrary to the Provision of the co-operative Societies Act. The bye-laws generally include the following clauses for internal management of co-operative society.
• Name and address of company
• Area of operation
• The manner in which and the limit up to which the funds of the society should be raised.
• Objects of society
• Maximum amount of share capital that my held by a member
• Terms and qualifications for admission of membership
• Rights, duties and liabilities of members.
• Maximum loan admissible to a member.
Disposal of net profit
• Rule no. 8 Maharashtra state Co-operative Societies Rule,1961 give the various details of the items in the bye-laws of the society.
• Any amendments, changes or deletion in bye-laws shall have to be approved by a resolution at special general meeting and also a written approval from the District Deputy Registrar is necessary.
• The first bye-laws of the society are required to be approved by the Registrar, as per Rule no.9.
Q14) What is Co-operative year under MCS Act?
A14) The Act has fixed 31st day of March as the day of balancing the accounts of the society. However, any other day can be fixed by the society for this purpose with the prior approval of the registrar. It means that the co-operative year need not necessarily be from 1st April to 31st March. Normally, now a days societies follow 31st March as the year ending to conform with the Income Tax Act.
Q15) What are Members under MCS Act?
A15) Under section 2(19), a member of a co-operative society means a person joining in an application for the registration of a co-operative society, which is subsequently registered or a person duly admitted to a member. Following are the different types of members-
• Associate Member: Associate member means a member who hold jointly a share of society with others, but whose name does not stand first in share certificate.
• Nominal Member: ‘Nominal Member ‘means a person admitted to membership as such after registration in accordance with its laws.
• Sympathiser Member: Sympathiser member means a person who sympathises with aims and objects of the society and who is admitted by society as such manner.
Q16) Give the classifications of Consumers co-operative society?
A16) Consumers co-operative society can be classified as under:
a. Primary Consumers society:
Such societies meet needs of direct customers. The controller goods purchased from central stores to which affiliated and others in bulk purchases in open market and sales at reasonable price to members, in some cases to non-members also.
b. Central Whole Stores:
These types of society deal in whole-sale business, and fulfil the needs of primary society.
c. Departmental stores:
In cities super market / Departmental stores are set up which stock are requirement of consumers under one roof. These types of societies need substantial amount for capital.
Q17) What does Section 65(1) of the Act states?
A17) Section 65(1) of the Act, amended in 1985, states that a society shall construct its relevant annual financial statement and arrive at its consequent net profit or loss in the manner prescribed. A co-operative society engaged in a business of Manufacturing, Trading or Banking should adopt mercantile system of accounting to arrive at true and fair profits.
Q18) What does Section 65(2) of the Act states?
A18) Section 65(2) states that a society may appropriate its Net Profit to the reserve fund or any other fund for payment of dividend to members on their shares. No parts of the profits shall be appropriated except with the approval of the General Body.
Q19) What does Section 64 of the Act states?
A19) Section 64 of the Act states that no part of the funds other than the dividend equalisation or Bonus equalisation shall be paid by way to bonus or dividend to its members.
Q20) What does Section 68 of the Act states?
A20) According to section 68 every society shall contribute annually towards the Education Fund and Rule No.53 prescribes the rates of contribution according to the nature of society.
| Class of society | Rate |
1 | Primary Consumers Society | 2 Paise per Rs.100 of the working capital subject to a maximum of Rs.1,000. |
2 | Urban Credit Society | 10% of the working capital in respect of those which have earned |
|
| Profit during the previous year subject to maximum of Rs.500 |
3 | Co-operative Sugar Factories | 25 paise per ton of sugarcane crushed subject to maximum of Rs.25,000. |
4 | Housing Society Backward Class housing society | Re.1 per member having a tenement Rs.10. |
5 | Urban credit bank | 1/10% of working capital subject to a maximum of Rs.1,000. |