When one officer controls the money: how dual approval protects a cooperative
When one officer receives, records and approves a society's money, everyone has to take that officer's word for it. KoopManager makes a second Exco member approve manual entries before they count, so no one is trusted alone and every decision leaves a record.
The problem: all the trust sits on one person
In a small cooperative the same officer often collects a deposit, records it and approves the payout that follows. That is not dishonest, but nothing in it can catch a slip. A mistyped amount or a deposit entered against the wrong member can stand for months, because the person who would notice is the person who made it.
Who feels it
- Members have to take their balances on trust, and questions at the annual general meeting have no record to answer them.
- Officers carry the suspicion when something looks wrong, even when they have done nothing wrong.
How KoopManager resolves it
Manual entries such as deposits, expenses and transfers are not posted until a second Exco member approves them. The person who entered an entry, and the member it is for, can never be that approver. Unusual amounts are flagged for the approver, the society decides how large an entry must be before two approvals are needed, and every decision is recorded with who made it and when.
The control protects members, and it protects officers just as much: when a figure is questioned, the record shows who entered it and who approved it.
Related guides
- How to move a cooperative society from spreadsheets to software
- Cooperative loan guarantees explained
- How cooperative dividends work
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