Friday 21 January 2011




(a) General :- In this part, an attempt is made to explain the special features of certain types of Co-operative Societies ad the important points to be borne in mind by the Auditor, while auditing the accounts of such societies. To audit the accounts of any type of society efficiently, the auditor should be well equipped with sufficient knowledge of Co-operative Law and other Laws.
The byelaws of Co-operative Societies restrict the scope of their activities to a few main objectives, say credit/’non credit’/distribution of consumer goods, farming operations, etc, and a few other allied activities incidental to the attaimment of the main objectives for which the society has been formed. It is the duty of the Auditor to ensure that the transactions carried on by the socierty are those permitted under the Co-operative Societies act, Rules and Byelaws of the society. The Auditor should, interalia, see that the society consists of only persons who are qualified to become members and also ensure that its funds have been applie d only to such purposes as are permissible under the Act. Rules and Bye-laws of the society. The Auditor should acquaint himself with the nature of the activities of different types of societies whose accounts he has to audit and also the manner adopted by the societies for conducting their transactions.
Before commencing audit, the Auditor should carefully study the Co-operative Societies Act, Rules, Bye-laws of the society, other relevant laws and the circular instructions issued by the Registrar from time to time about audit of different types of societies. Wherever, the nature or the number of the irregularities warrants detailed checking, and if more time is required for completion of the audit, the higher authorities should be appraised of the position. The norms or standards laid down by Registrar in awarding the audit classification should be followed by the Auditor in awarding the correct classifications.
(b) Accounts and other books to be maintained by societies :- Statutory provision. Rule 29 of the Kerala Co-operative Societies Rules, prescribe the nature of accounts and other books to be maintained by the societies in connection with the business. The Auditor has to ensure that the societies have properly maintained the required registers.

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