Short Answer

For splitting a large repair over two financial years in a cooperative society, the budgeting process involves allocating funds in each financial year based on the estimated cost of the repair work.

Detailed Explanation

Section 81 of the Gujarat Cooperative Societies Act, 1961 allows cooperative societies to prepare annual budgets for their maintenance and repair expenses. This section mandates that the budget should include provisions for repairs, renewals, and replacements of the society's assets. When a large repair is anticipated to span over two financial years, the society can allocate funds accordingly in each year's budget.

Rule 76 of the Gujarat Cooperative Societies Rules, 1965 further elaborates on the budgeting process for maintenance and repair expenses. It specifies that the society's managing committee is responsible for estimating the cost of repairs and including them in the annual budget. In the case of a repair project that extends beyond one financial year, the committee should divide the estimated cost proportionately over the years involved.

In practice, cooperative societies follow a systematic approach to budgeting for large repairs spread over multiple years. The managing committee assesses the total cost of the repair project, determines the timeline for completion, and then divides the estimated expenses into annual budgets. This ensures that the society has adequate funds reserved for each phase of the repair work.

Real-world Scenarios

• Scenario 1: A cooperative housing society needs to undertake a major renovation of its common areas, including the lobby, elevators, and parking lot. The estimated cost of the renovation is substantial and is expected to be completed over two years. The managing committee allocates funds in the annual budgets for both years based on the projected expenses for each phase of the renovation.

• Scenario 2: A cooperative society's clubhouse requires significant structural repairs to address water leakage issues. The repair work is planned to be carried out over two financial years due to the extent of the damage. The managing committee budgets for the repair costs by dividing the total estimated expenses evenly between the two years.

• Scenario 3: A cooperative society's office building needs a complete overhaul of its electrical wiring and plumbing systems. The repair project is scheduled to span across three financial years. The managing committee prepares a detailed budget outlining the annual allocation of funds for each phase of the repair work.

Reference

• Section 81 of the Gujarat Cooperative Societies Act, 1961: Official PDF

• Rule 76 of the Gujarat Cooperative Societies Rules, 1965: Official PDF