Audit of co-operative societies
As per section 6 of the co-operative societies act 1912, any ten persons who are willing to enter into contact and can make an application to the Registrar of Co-operative societies. There are two types of co-operative societies namely limited liabilities and unlimited liabilities co-operative societies. These societies are based on the liability their member has to pay the nominal value of share they held in the societies and no member can own more than 20% of shares of societies. On the other hand, the government is encouraging co-operative societies to help society in every way they can. These societies are mostly included in the double-entry system which makes the account more clear and easy to check on.
How the audit of these co-operative societies are done?
As per section 17 of the co-operative society act, 1921 the registrar shall be audited by some person authorized by him by general or special orders only if it was written. Subsection (1) consists of some rules for debit the amount and valuation of the assets and liabilities in the society. The person who has approval from the registrar, the collector and the person authorized has given the authority to access the books of account, the security of the society and these information are concern with the transactions and working of society as the person making such arrangements. The auditor is the qualified person who holds a government diploma in Co-operative accounts or in cooperation or accountancy and that makes a person served as an auditor in the co-operative society department.
What are the rights and duties of an auditor in a co-operative society?
Some section of laws gives the auditor some rights regarding the books of account, ledger, bank statement and securities of society. It is the duty of the auditor to make a fair and true view of the balance sheet of a business according to the information and explanation are given to the auditor. On the other hand, every officer is bound to give proper and full information regarding the working and transaction of society. Just like rights the auditor also have some duties regarding co-operative society as it is mandatory for the auditor to well-versed with the cooperative society. It is also the duty of the auditor to point out any irregularities and improperties during the audit. Most importantly he should check thoroughly the cash book and bank book.