Chapter 14 (Law on Cooperatives)
An amount for the reserve fund which shall be at least ________ of net surplus: Provided, That, in the first five (5) years of operation after registration, this amount shall not be less than fifty per centum (50%) of the net surplus.
ANSWER: Ten per centum (10%) SOURCE: Art. 85 of RA 9520
TRUE or FALSE: Cooperatives registered under RA 9520 shall be subject to an annual financial, performance and social audit.
ANSWER: True SOURCE: Art. 80 of RA 9520
An optional fund, a land and building, and any other necessary fund the total of which shall not exceed_________.
ANSWER: 7 percent (See Art. 86 of RA 9520)
Notwithstanding the provisions of existing laws, the net surplus of cooperatives shall be determined in accordance with its ______.
ANSWER: Bylaws SOURCE: Art. 85 of RA 9520
The Government may lease public lands to any agrarian reform cooperative for a period not exceeding ________ years, subject to renewal for another ________ years. a. 10,10 b. 20,20 c. 25,25 d. 15,15
ANSWER: C. 25,25 (See Art 91 of RA 9520)
TRUE or FALSE: If the electric service provider fails to provide the services requested within a period of 6 months, the agrarian reform cooperative concerned may undertake to provide the electric services in the area through its own resources.
ANSWER: False ( period of 1 year) SOURCE: Art. 92 of RA 9520
The powers and functions of a cooperative bank shall be subject to such rules and regulations as may be promulgated by the ___________.
Ans: Bangko Sentral ng Pilipinas (ART. 100. Powers, Functions and Allied Undertakings of Cooperative Banks, RA 9520)
The financial audit shall be conducted by an external auditor who satisfies all the two qualifications:
Answer: 1. He is independent of the cooperative or any of its subsidiary that he is auditing; and 2. He is a member in good standing of the Philippine Institute of Certified Public Accountants (PICPA) and is accredited by both the Board and Accountancy and the Authority. SOURCE: Art. 80 of RA 9520
ENUMERATION: Associate members are those subscribing and holding preferred shares of the bank, which may include but are not limited to?
Answer: a. Individual members of the bank's member-primary cooperatives; b. Samahang Nayon and Municipal Katipunan ng mga Samahang Nayon See Republic Act No. 9520 Article 97
ENUMERATION: Agrarian reform cooperatives may be given the exclusive right to do any or all of the following economic activities in agrarian reform and resettlement areas;
Answer: (1) Supply and distribution of consumer, agricultural, aqua-cultural, and industrial goods, production inputs, and raw materials and supplies, machinery, equipment, facilities and other services and requirements of the beneficiaries and marginal farmers at reasonable prices; (2) Marketing of the products and services of the beneficiaries in local and foreign markets; (3) Processing of the members' products into finished consumer or industrial goods for domestic consumption or for export; (4) Provision of essential public services at cost such as power, irrigation, potable water, passenger and/or cargo transportation by land or sea, communication services, and public health and medical care services; (5) Management, conservation, and commercial development of marine, forestry, mineral, water, and other natural resources subject to compliance with the laws and regulations on environmental and ecological controls; and (6) Provision of financial, technological, and other services and facilities required by the beneficiaries in their daily lives and livelihood. (See Section 11 Article 93 of the Cooperative Code of the Philippines)
An amount for the community development fund, which shall not be less than _________ of the net surplus. The community development fund shall be used for projects or activities that will benefit the community where the cooperative operates. A. 3% B. 4% C. 5% D.7%
Answer: A (See Sec. 10, Art. 86, Par. 3)
In ______ reform and resettlement areas, the Government shall grant to agrarian reform cooperatives preferential treatment in the construction, maintenance and management of roads, bridges, canals, wharves, ports, reservoirs, irrigation systems, waterworks systems, and other infrastructures with government funding. For this purpose, the Government shall provide technical assistance, facilities and equipment to such agrarian reform cooperatives. A. Agrarian B. Agricultural C. Aggressive D. Aggresor
Answer: A (Source: RA 9520 Art. 90)
The amount for the reserve fund which shall be at least ____ of net surplus A. 5% B. 10% C. 15% D. 20%
Answer: B. 10% (See Article 86 of R.A 9520)
An agrarian reform cooperative as defined shall be organized for any or all of the following purposes EXCEPT: A. To develop an appropriate system of land tenure, land development, land consolidation or land management in areas covered by agrarian reform. B. To provide financial facilities to beneficiaries for provident or productive purposes at reasonable costs. C. To establish a usufructuary trust fund for the benefit of any federation or union to which the cooperative is affiliated. D. To arrange and facilitate the expeditious transfer of appropriate and suitable technology to beneficiaries and marginal farmers at the lowest possible cost.
Answer: C (See Article 88, R.A. 9520)
The cooperative banks registered under this Code shall be under the supervision of the? a. BIR b. Commission on Audit c. BSP
Answer: C. (Art 96 of RA 9520)
Statement I: Regular membership shall be limited to cooperative organizations which are holders of common shares of the bank. Statement II: The articles of cooperative and bylaws of a cooperative bank shall be registered with CDA only when accompanied by a certificate of authority issued by the BSP, under its official seal. Which of the mentioned statements are true? A. Statement I only B. Statement II only C. All of the statements D. None of the statements
Answer: C. Chapter XII, Article 97, RA 9520
In agrarian reform areas, an agrarian reform cooperative shall have the __________ in the grant of franchise and certificate of public convenience and necessity for the operation of public utilities and services. a. common right b. economic right c. preferential right d. none of the above
Answer: C. preferential right (Art. 92, RA 9520)
The Government may lease public lands to any agrarian reform cooperative for a period not exceeding twenty-five (25%) years, subject to renewal for another twenty-five (25) years only: Provided, That the application for renewal shall be made one (1) year before the expiration of the lease: Provided, further, That such lease shall be for the exclusive use and benefit of the beneficiaries and marginal farmers subject to the provisions of the ___________ Program.
Answer: Comprehensive Agrarian Reform Source: RA 9520 Art. 91
It refers to landholdings like plantations, estates or haciendas acquired by the State for the benefit of the workers in accordance with the Comprehensive Agrarian Reform Program which shall be collectively owned by the worker-beneficiaries under a cooperative set-up.
Answer: Corporate Estate (See Republic Act 9520 Sec. 11, Art. 89)
The said union or federation shall submit to the Authority and to its contributing cooperatives the following schedules: EXCEPT a. List of cooperatives which have remitted their respective Cooperative Education and Training Funds (CETF); b. Business consultancy assistance to include the nature and cost; and c. Other training activities undertaken specifying therein the nature, participants and cost of each activity. d. Laws representing tribunal factors
Answer: D (See Chapter 5 ART 86 RA 9520)
If within any period of time specified in the ______, any subscriber who has not fully paid his subscribed share capital or any non-member patron who has accumulated the sum necessary for membership but who does not request nor agree to become a member or fails to comply with the provisions of the bylaws for admission to membership, the amount so accumulated or credited to their account together with any part of the general fund for nonmember patrons shall be credited to the reserve fund or to the education and training fund of the cooperative, at the option of the cooperative. A. Committee B. Member C. Board of Directors D. Bylaws
Answer: D. Bylaws (See ART. 86. Order of Distribution)
An agrarian reform cooperative as defined shall be organized for any or all of the following purposes EXCEPT: A.) To provide financial facilities to beneficiaries for provident or productive purposes at reasonable costs B.) To develop an appropriate system of land tenure, land development, land consolidation or land management in areas covered by agrarian reform C.) To provide social security benefits, health, medical and social insurance benefits and other social and economic benefits that promote the general welfare of the agrarian reform beneficiaries and marginal farmers D.) All of these are purposes of an agrarian reform cooperative.
Answer: D.) All of these are purposes of an agrarian reform cooperative. (See Republic Act 9520 Sec. 11, Art. 88)
TRUE or FALSE: The external auditor who shall conduct the financial audit should be dependent of the cooperative or any of its subsidiary that he is auditing and he should not be a member in good standing of the Philippine Institute of Certified Public Accountants (PICPA) and is accredited by both the Board and Accountancy and the Authority.
Answer: False SOURCE: Art. 80 of RA 9520
TRUE or FALSE: Upon dissolution of the cooperative, the reserve fund shall be distributed among the members.
Answer: False SOURCE: Art. 82 of RA 9520
The sum allocated for patronage refunds shall be made available at different rates to all patrons of the cooperative in proportion to their individual patronage.
Answer: False (See Article 86, RA 9520)
TRUE or FALSE: Every cooperative shall determine its net surplus at the close of every calendar year and at such other times as may be prescribed by the bylaws.
Answer: False (It should be in "fiscal" year.) SOURCE: Art. 85 of RA 9520
TRUE or FALSE: The auditor is liable to any person in an action for defamation based on any act, done, or any statement made by him in good faith in connection with any matter he is authorized or required to do pursuant to this Code.
Answer: False (not liable) SOURCE: Art. 82 of RA 9520
TRUE OR FALSE: The voting rights of the members may not be proportionate to the number of their paid-up shares.
Answer: False Chapter XI ,Article 99
TRUE or FALSE: In agrarian reform areas, an agrarian reform cooperative shall have the substantial right in the grant of franchise and certificate of public convenience and necessity for the operation of public utilities and services provided that it meets the requirements and conditions.
Answer: False, preferential ( Source: Article 92 of RA 9520)
The authority, in consultation with the concerned government agencies and cooperative sector shall issue appropriate _____________ pertaining to the provisions of this Code.
Answer: Rules and Regulations (See Art. 94, RA 9520)
Landholdings like plantations, estates or haciendas acquired by the State for the benefit of the workers in accordance with the Comprehensive Agrarian Reform Program which shall be collectively owned by the worker-beneficiaries under a cooperative set-up.
Answer: TRUE (See R.A. 9520 Sec. 11)
TRUE or FALSE: The Government shall provide the necessary financial and technical assistance to agrarian reform cooperatives to enable them to discharge effectively their purposes under Article 93 of RA 9520.
Answer: True
Any subscriber who has not fully paid his subscribed share capital or any non-member patron who has accumulated the sum necessary for membership but who does not request nor agree to become a member or fails to comply with the provisions of the bylaws for admission to membership, the amount so accumulated or credited to their account together with any part of the general fund for nonmember patrons shall be credited to the reserve fund or to the education and training fund of the cooperative, at the option of the cooperative.
Answer: True (See Republic Act No. 9520 Article 86)
An agrarian reform cooperative is one organized by marginal farmers, majority of which are agrarian reform beneficiaries, for the purpose of developing an appropriate system of land tenure, land development, land consolidation or land management in areas covered by agrarian reform.
Answer: True (See Sec. 11, Art. 88)
An amount for the reserve fund which shall be at least ten per centum (10%) of net surplus: Provided, That, in the first five (5) years of operation after registration, this amount shall not be less than fifty per centum (50%) of the net surplus
Answer: True (See R.A.9520, Section 10, Art. 86)
TRUE or FALSE: A member shall have the right to examine the records required to be kept by the cooperative under Article 52 of this Code during reasonable hours on business days and he may demand, in writing, for a copy of excerpts from said records without charge except the cost of production.
Answer: True SOURCE: Art. 83 of RA 9520
TRUE or FALSE: Every cooperative shall, at its principal office, keep and carefully preserve the records required by this Code to be prepared and maintained. It shall take all necessary precaution to prevent its loss, destruction or falsification.
Answer: True SOURCE: Art. 84 of RA 9520
An amount for the reserve fund which shall be at least ten per centum (10%) of net surplus
Answer: True (See Chapter 5 Art. 86 RA 9520)
TRUE or FALSE: The Government may lease public lands to any agrarian reform cooperative for a period not exceeding twenty-five (25%) years, subject to renewal for another twenty-five (25) years only: Provided, That the application for renewal shall be made one (1) year before the expiration of the lease: Provided, further, That such lease shall be for the exclusive use and benefit of the beneficiaries and marginal farmers subject to the provisions of the Comprehensive Agrarian Reform Program.
Answer: True (See Sec. 11, ART. 91. Lease of Public Lands,RA 9520)
TRUE OR FALSE: The quorum requirement for general assembly meetings, whether special or regular, shall be one half plus one of the number of voting shares of all the members in good standing.
Answer: True (see Chapter XII, Art. 99 of RA 9520)
TRUE OR FALSE: BSP may prescribe appropriate guidelines, ceilings and conditions on borrowing of a cooperative organization from a cooperative bank.
Answer: True Chapter XII, Article 100, RA 9520
TRUE OR FALSE: To maintain the quality of bank management and accord appropriate protection to depositors and the public in general, the BSP shall prescribed the fit and proper qualifications of bank directors and officers for the purposes of this article, giving due recognition to the unique nature and character of cooperative banks.
Answer: True Source: R.A. 9520 Art. 98
The remaining net surplus shall be made available to the members in the form of interest on share capital not to exceed the normal rate of return our investments and patronage refunds: Provided, That any amount remaining after the allowable interest and the patronage refund have been deducted shall be credited to the reserve fund.
Answer: True. (See ART. 86. Order of Distribution par. 5)
An agrarian reform cooperative is one organized by _, majority of which are agrarian reform beneficiaries, for the purpose of developing an appropriate system of land tenure, land development, land consolidation, or land management in areas covered by agrarian reform. a) marginal farmers b) agrarian reform cooperatives c) cooperative banks d) public service cooperatives
Answer: a) marginal farmers (See Article 88, Section 11 of RA 9520)
Agrarian reform cooperatives may be organized and registered under this Code only upon prior written verification by the ____________ to the effect that the same is needed and desired by the beneficiaries; results of a study that has been conducted fairly indicate the economic feasibility of organizing the same and that it will be economically viable in its operations; and that the same may now be organized and registered in accordance with requirements of this Code. a. Department of Agrarian Reform (DAR) b. Department of Environment and Natural Resources (DENR) c. Department of Justice (DOJ) d. Department of Trade and Industry (DTI)
Answer: a. Department of Agrarian Reform (DAR) (See Section 11 Aricle 94 of the Cooperative Code of the Philippines)
Which of the following distribution of net surplus is correct? I. At least 10% shall be allocated to the reserve fund II. At least 50% shall made available to the members III. Maximum of 10% for education and training fund IV. The remaining shall be allocated to the optional fund a. I and III b. II and IV c. All of the above d. None of the above
Answer: a. I and III (See Art. 86, RA 9520)
Statement 1. The provisions of this Chapter shall primarily govern cooperative banks registered under this Code and the other provisions of this Code shall apply to them only insofar as they are not inconsistent with the provisions contained in this Chapter. Statement 2. The cooperative banks registered under this Code shall be under the supervision of the COA. a. Statement 1 True; Statement 2 False b. Statement 1 False; Statement 2 True c. Both Statements are True d. Both Statements are False
Answer: a. Statement 1 True; Statement 2 False Source: Republic Act No. 9520 Chapter XII Article 95 and 96
An ________ is one organized by marginal farmers, majority of which are agrarian reform beneficiaries, for the purpose of developing an appropriate system of land tenure, land development, land consolidation or land management in areas covered by this law.
Answer: agrarian reform cooperative (See Article 88 of RA 9520)
Any sum recovered on items previously charged to the reserve fund shall be ____ to such fund. a. debited b. credited c. aggregated d. charged
Answer: b (See Article 86)
The Government may lease public lands to any agrarian reform cooperative for a period not exceeding ______ years, subject to renewal for another ______ years only. a. 20, 20 b. 25,25 c. 30,30 d. 50,50
Answer: b (Art. 91, RA 9520)
The auditor shall submit to the board of directors and to the audit committee the financial audit report which shall be in accordance with the generally accepted auditing standards for cooperatives as jointly promulgated by the _________. a. Philippine Institute of Certified Public Accountants b. the Authority c. Both A and B d. none of the above
Answer: c. Both A and B SOURCE: Art. 81 of RA 9520
An amount for the __________, which shall not be less than three per centum (3%) of the net surplus. The community development fund shall be used for projects or activities that will benefit the community where the cooperative operates.
Answer: community development fund (See Art. 86, RA 9520)
A ____________ shall primarily provide financial, banking and credit services to cooperative organizations and their members.
Answer: cooperative bank Source: Art. 100
Every cooperative shall determine its __________ at the close of every fiscal year and at such other times as may be prescribed by the bylaws. a. Net Shortage b. Net Deficit c. Net Advantage d. Net Surplus
Answer: d. Net Surplus SOURCE: Art. 85 of RA 9520
In the meetings of the board of directors, whether special or regular, the quorum requirement shall be ___________________ of all the members of the board of directors.
Answer: one-half plus one See Republic Act No. 9520 Article 99
An ______ fund, a land and building, and any other necessary fund the total of which shall not exceed seven per centum (7%).
Answer: optional (See Article 86 of R.A 9520)
The ________________ shall be used for the stability of the cooperative and to meet net losses in its operations. The general assembly may decrease the amount allocated to the reserve fund when the reserve fund already exceeds the share capital.
Answer: reserve fund (See Chapter 5 ART. 86 RA 9520)
The sum allocated for patronage refunds shall be made available at ______ rate to all patrons of the cooperative in proportion to their individual patronage.
Answer: same rate (See Art. 86, 9520)
An amount for the community development fund, which shall not be less than ____ per centum of the net surplus. The community development fund shall be used for projects or activities that will benefit the community where the cooperative operates.
Answer: three (3) (See ART. 86. Order of Distribution par. 3)
Notwithstanding the provisions of this Code to the contrary, the quorum requirement for amendments of articles of cooperation and bylaws shall be ________ vote of all the members with voting rights, present and constituting a quorum. All other voting requirements shall be as prescribed by the BSP.
Answer: three-fourths (3/4) (Chapter XI ,Article 99)
ENUMERATION: Membership in a cooperative bank shall either be:
a. Regular- Regular membership shall be limited to cooperative organizations which are holders of common shares of the bank; b. Associate- Associate members are those subscribing and holding preferred shares of the bank. Source: Art. 97