A cooperative organization is an association of people, usually with limited means, who come together voluntarily to achieve a common economic objective, forming a democratically controlled business organization that makes equitable contributions to necessary capital, accepting a share of risks and rewards. It is a system that has evolved a lot, because it favors the organization of work, along with numerous advantages. On the other hand, it is not without problems, it requires attention in some points. Therefore, accounting for Cooperatives
and cooperative auditing have grown a lot in the market, helping with useful information and contributing to the transparency process.
Below we list some benefits of society a cooperative:
easy constitution: The formation of an organization a cooperative
is simple compared to any other business organization. It does not limit the number of people, the registration process is simple and also does not restrict the entry and exit of members. In most cases, members' liabilities are limited to the extent of capital they contribute, alleviating the worry of compromising their private property in the event of financial losses to the society.
local community development: At Cooperatives
one of their principles is the interest in the community, so they go beyond a traditional business model and allow the people involved to contribute to promoting sustainable actions. Members can also purchase inputs at more attractive prices, thus increasing production or providing services and, consequently, establishing competitiveness in the market.
stability and continuity: An organization a cooperative
cannot be dissolved by the insolvency of death or permanent incapacity of the members. Hence, she has a stable life and continues to exist for a long time as her legal existence is individualized. New members can join and old ones leave the association, without interrupting its functioning, unless all members unanimously decide to close it.
Democratic management: A a cooperative is administered by members elected from among themselves. As such, members have equal rights through a single vote, but can actively participate in the formulation of their policies.
economic operations: On the a cooperative, intermediary services are provided by members at minimal cost, because recurring and non-recurring expenses are much lower. Members receive better goods and services at reasonable prices. Besides the a cooperative provide financial aid and assist in setting up more production units and marketing products for small businesses. In some cases, it sells goods to outsiders and the profit is used to meet administrative costs.
government sponsorship: The government provides special assistance to Cooperatives, lending money at lower rates, allowing them to achieve their goals. In addition to extending subsidies, strengthening financial stability and sustainable growth.
Despite many advantages, the organization a cooperative It also suffers from some limitations and drawbacks:
inefficient management: One a cooperative it is managed only by its members, who often lack management skills. This is considered one of the biggest downsides in the industry, as management inefficiency can impede the organization's success.
Limited resources: The financial strength of Cooperatives
it depends on members' contribution threshold and their borrowing capacity from government cooperative banks. Its members belong to the middle and lower classes and the membership fee is limited, not allowing a large amount of resources to be raised. Large-scale businesses, which require large amounts of capital, are usually not suitable for Cooperatives.
Excessive government interference: Often, because there are government people on the board of directors of Cooperatives, they influence the board's decision, which may or may not be favorable to the interests of society. This excessive state regulation interferes with the flexibility of the operation and negatively affects the efficiency of management.
Lack of secrecy and differences: The subjects of interest to the Cooperatives
are discussed openly at meetings, but secrecy is an important aspect for the success of any commercial organization, making the lack of it open the way to facilitate the competitiveness of competitors. the administration of a cooperative it also includes people from different social, academic and economic backgrounds, who often differ in opinions on important issues. These differences and possible disputes can weaken the interest of the a cooperative
and paralyze the effectiveness of its management.
In all this context, the cooperative auditing became an important practice in the cooperative management process, because qualified professionals for the area contribute significantly to the proper management and desired level of transparency.
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TATICCA – ALLINIAL GLOBAL provides auditing services for cooperatives and has a team capable of responding to the demands of the new resolutions, with the objective of assisting cooperatives in obtaining transparency in their management. A TATICCA also provides integrated auditing, accounting, tax, corporate finance, financial advisory, risk advisory, technology, business consulting and training services. For more information, visit www.taticca.com.br or e-mail taticca@taticca.com.br. Our company has professionals with extensive experience in the market and has certified methodologies for carrying out activities.