Co-op Management Module

Manage your Co-op admin online

Use our state of the art Co-op Management Module to issue your Member`s Share Certificates to be compliant with the Co-op Act.

The Co-op data is stored securely online at no cost. All the members can view the Director and Members` register to ensure transparency and accuracy. Annual General Meeting reminder dates and financial management graphs also available for all to view.

You only pay once for downloading each members share certificate.

Good to know

If we registered your Co-op your FREE Share Certificates can be (downloaded) printed here. For any additional share certificates you will need to purchase credits.

Price : From R100
How long does it take? Same Day

Call Centre
021 595 4433

Email
info@swiftreg.co.za

WhatsApp
060 070 2089

Frequently Asked Questions

What is the minimum number of directors on a Co-op?

Two

Does every member have the same vote?

Yes, all primary Co-op members have one vote regardless of how many shares each member has.

Can new members join an existing Co-op?

Yes, absolutely. They are required to be accepted by the directors and pay the entrance fee and or the share contribution as stipulated by the constitution. It is a good idea to withhold a portion of the authorised share capital so that it can be issued to the new members.

Can a Pty be a member of a Co-op?

Yes, but then there must be a minimum of two companies. The companies will have the same voting rights as the other members.

What is the Patronage Principle?

This is when the profits are paid out according to the amount of business each member does with the Co-op and not according to the amount of shareholding.

What is the User Pay principle?

If some members use the Co-op equipment more than others, then they must pay proportionally for the use of the equipment. For example, if a combine harvester is owned by an Agricultural Co-op and only a few members use the asset then they will pay proportionally for the running costs of operating it.

Should a Co-op have an annual fee or a user pay principle?

The purpose of the annual fee is to fund the cashflow of the business while the purpose of the user pay principle is that the members who use the Co-ops assets the most should pay proportionally more as they may have had a greater benefit. Both can be selected where relevant.

Should a Co-op have an entrance fee, share contribution or both?

This is an important consideration. If the members are required to contribute different amounts of funding to the Co-op then the share contribution is advisable. If each member is required to contribute equal amounts of money, then share contribution is not necessary and the entrance fee essentially substitutes it. It is also possible to have both as we have used in our default example.

Does my Co-op need an auditor?

Only if the annual turnover exceeds R25 million. However, CIPC requires annual returns to be paid which will depend on the turnover of your Co-op which will be categorised into one of the following 4 groups. The category will determine what information you need to supply to CIPC. Category Turnover Responsible Person Documents A1 Less than R1m Director Financials, Co-op forms 7,8 and 15.1 A2 Between R1m – R10m Director Financials, Co-op forms 7,8 and 15.2 B Between R10m – R25m Independent Reviewer Financials, Co-op forms 4, 7 and 8 C More than R25m Auditor Financials, Co-op forms 4, 7 and 8 For example, your Co-op’s turnover is less than R1m a year, it will be classified as category A1. The Directors will need to complete the Co-op forms 7, 8 and 15.1 which must be supported by an income statement and balance sheet and submitted to CIPC on an annual basis. Form Co-op 8 includes annual fees which must also be paid to CIPC as failure comply with any of these requirements will result in the Co-op being non-compliant which will attract penalties and may be deregistered by CIPC.

Do Co-ops have shareholders?

Yes, all the members become the shareholders (owners) of the Co-op and therefore are responsible for raising the finances to start the business. The number of shares each member is issued is determined by the amount of money each member invests. This could result in some members owning more shares than others. It is important to note that all Co-op shares are of a single class, meaning there are no preferential shares and no preferential voting rights.

What is authorised share capital?

Authorised share capital is the total number of shares that are “created out of thin air” when a Co-op is formed. All the authorised shares belong to the Co-op and remain “dormant” until they are issued to the members. Each issued share now becomes “active” and represents a part ownership of the Co-op. Only the issued shares (not the authorised shares) make up 100% ownership of the Co-op.

Do unallocated shares have any value?

No, unallocated shares belong to the Co-op and remain dormant with no rights linked to them. Only when the shares are issued do they become active and can participate in profit sharing. Only the total of all the issued shares make up 100% of the Co-op ownership.

What is a Par Value share?

Par value shares is an outdated concept from centuries ago when markets were unregulated. It pegs the value of a share at a fixed minimum value. The implication of this is that the shareholders exposure to the Co-op is limited to the value of the Par Value shares. In reality the actual value of the shares goes up and down, so in order to balance the books, the difference between the actual value and the par value is called the share premium which is recorded in the financials.

What are distinctive numbers?

Each issued share is assigned a permanent number starting from one and ending with the last issued share. This means no share can be duplicated nor divided into fractions. For example, if you are the first shareholder in the Co-op and you own ten shares then your distinctive number of your shares will be share numbers 1 to 10. The share ownership including the distinctive numbers is maintained in the company share register and authenticated when the directors and the members both sign the original share certificate.

What is a share register?

This is the record of all the shareholders indicating who owns which shares. It is a legal requirement and the directors are responsible for keeping it current and up to date. It needs to include the history of all share transfers. To assist with this task, we have created an online members management tool which records all shareholding, share transfer history, the loan accounts, issuing of the certificates as well as meeting notifications.

How is a share certificate validated?

Share certificates are validated when they are signed by the chairperson, the treasurer and the member as this ensures all signatories agree on the accuracy. There can only be one original share certificate and it can’t be duplicated and should be kept in a safe place as proof of ownership of the Co-op.

Are the loan accounts interest bearing?

Yes, all the money invested in the Co-op is deemed by SARS as a loan to the Co-op and all loan accounts attract interest. This means that the Co-op owes the interest on the investment which must be indicated on the loan certificate. When the interest is paid back it is an expense for the Co-op and deemed as income in the member’s personal name which must be added as income to the member’s tax return.

What is the difference between a member’s register and a director’s register?

The director’s register requires additional information such as a list of entities they belong to and a disclosure of interest of business dealings which may have a material impact on the Co-op.

Are all Co-ops required to have a members register?

Yes, it is a legal requirement and we have created a membership management tool which will assists the directors issue the share and loan certificates as well as sending out compulsory notifications for the respective meeting.

Can members view the register?

Yes, all members have the right to view the register and our online membership management tool facilitates this.

How often should members receive statements of their loans?

Monthly as it is a legal requirement for the directors to issue monthly updated loan statements.

When should the first AGM be held?

It is required to be held within 18 months of the date of incorporation and after that, all subsequent AGMs must be held within 6 months of the financial year end.

Should all members have a Share Certificate?

Yes, as well as monthly loan statements

What happens when a member dies?

The members register must record who the nominee of the members shares will be so that in the event of death the value of the shares (based on Par Value) will be paid to the nominee.

Do members share equally in the profits?

This depends on 2 factors, namely, what the members have agree to and what is stated in the constitution. If some members own more shares than others, then they will be entitled to more profits. The constitution may also state that the profits are based on a user patronage principle and again this will mean that some members will be entitled to greater profits. Alternatively, if the members choose to make equal share contributions or scrap the share contribution altogether and only rely on raising money through the entrance fee then everyone should have made equal contributions to raising the money and therefore own equal shares in the Co-op. In such a scenario the profits are distributed evenly. The method of profit distribution should be cleared up during the planning phase.

Do I share in the profits if my shares are not paid up?

Shares can be issued even if they are not yet paid for them. However, in these cases the shareholder will only share in the profits to the percentage of the shares that are paid up. For example, if 80% of the shares are paid, the shareholder will receive 80% of the assigned profits.