1. A journey into the Ontario Co-operative Association and the Ontario co-operative sector. Ontario Co-operative Association 450 Speedvale Avenue West, Suite 101 Guelph, Ontario, Canada N1H 7Y6 Email: [email_address] Tel: 519.763.8271 Toll Free: 1.888.745.5521 Fax: 519.763.7239
Co-op structure – not organized as profit/NFP Share Capital vs Non-share capital: Share capital refers to shares offered by the co-op to members or outside investors. Often called member equity. Often used to buy equipment, land, or other fixed assets. Incorporating without share capital means that the co-op must rely on debt financing to raise money. Fine for covering operating expenses such as supply purchasing. Co-ops can combine debt financing with share capital. Shares pay a return to members. On Co-op is organized as a co-op without share capital. In BC, the BC Co-op Association has share capital and pays dividends back to members. Revenue and distribution of surplus Revenue used to buy assets and pay expenses. In co-ops surplus can be distributed to members through patronage, which is usually distributed based on how much business a particular member does with the co-op. payments can be in cash or in additional patronage loans.
For co-ops: Non profit does not mean NO profit NFP – community focus Co-ops better the lives of their members (not always the same); membership is the end benefit, community is ancillary In Canada. Profit/NFP is defined by Canada Revenue Agency. Essentially means that the organization does not operate with the primary purpose of generating profit.