How cooperative dividends work
A dividend is a share of the surplus paid to members, and it is where disagreements are most likely. KoopManager closes the year, lets the Exco define how the dividend is shared, and sends the result for approval before any payout is queued.
What is a cooperative dividend?
When a cooperative earns more than it spends in a year, the surplus can be shared with members as a dividend. Whether and how much is paid is decided under the society's bye-laws and by its members, so this guide is general information, not legal or financial advice.
The problem: everyone wants to know how their share was worked out
Members compare what they receive with what a colleague receives. Officers have to explain a method agreed at the meeting but rebuilt by hand from spreadsheets, often late in the year, and any gap in the contribution history becomes an argument.
Who feels it
- Members want to know how their share was reached, and a figure nobody can reproduce breeds mistrust.
- Officers are blamed for a method the members themselves approved, and spend year end rebuilding histories in a hurry.
How KoopManager resolves it
After the year is closed, the Exco decides how much of the surplus to set aside for the dividend and defines how it is shared across members. KoopManager then works out every member's share on the same basis, locks the split once it is submitted, and requires approval before anything is paid. Approved shares are queued for payout, and the split can be exported for the meeting.
Before paying, reconcile member balances to the bank and agree the method at the general meeting.
Related guides
- How to move a cooperative society from spreadsheets to software
- Cooperative loan guarantees explained
- The financial reports every cooperative Exco needs
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