Short Answer

Yes, as per the Gujarat Cooperative Societies Act, 1961 and Rules, 1965, a society with branches or units is required to prepare consolidated financial statements.

Detailed Explanation

Section 81 of the Gujarat Cooperative Societies Act, 1961 mandates that every society shall prepare annual statements of accounts, including a balance sheet and profit and loss account. This includes all branches or units of the society. Rule 127 of the Gujarat Cooperative Societies Rules, 1965 further elaborates on the preparation of financial statements, specifying that the accounts of all branches or units shall be consolidated in the main financial statements of the society.

In practice, this means that each branch or unit of a society must maintain its own financial records, which are then consolidated into the overall financial statements of the society. This consolidation provides a comprehensive view of the financial position and performance of the society as a whole. Failure to prepare consolidated financial statements can lead to non-compliance with the Act and Rules, resulting in potential legal consequences.

Real-world Scenarios

• Example: A cooperative credit society operates multiple branches in different locations. Each branch maintains its financial records, which are later consolidated into the society's annual financial statements.

• Example: A cooperative housing society has various units for different types of housing. The financial accounts of each unit are combined to present a consolidated financial picture of the entire society.

• Example: A cooperative agricultural society has separate units for different crops. By preparing consolidated financial statements, the society can assess the overall financial health and performance of all its units collectively.

References

• Section 81 of the Gujarat Cooperative Societies Act, 1961

• Rule 127 of the Gujarat Cooperative Societies Rules, 1965