Practice question
A cooperative’s governing body allocates surplus to reserves and patronage-based member benefit, consistently with applicable distribution rules. A member insists Article4 requires all surplus always be distributed solely according to capital held. Which is correct?
- Article4 recognizes reserves and patronage-based benefits rather than that asserted capital-only rule
- Every surplus must always follow capital shares alone
- Reserves are categorically prohibited
- Patronage can never matter
- Education spending necessarily invalidates registration
Legal references
- RA9520 Philippine Cooperative Code: https://cda.gov.ph/issuances/republic-act-9520/ Articles3,4 and9.
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