Chapter 8:4 Non Profit Corporations:

Transcription

1 Chapter 8:4 Non Profit Corporations:

2 We will identify different types of cooperative organizations. We will examine the purpose of nonprofit organizations, including professional and business organizations.

3 1Co_10:33 Even as I please all men in all things, not seeking mine own profit, but the profit of many, that they may be saved.

4 Cooperatives: A cooperative is a business organized owned and operated by a group of individuals for their shared benefit. It works together, the individuals help one another.

5 Act_2:46 And they, continuing daily with one accord in the temple, and breaking bread from house to house, did eat their meat with gladness and singleness of heart. And all that believed were together, and had all things common; And sold their possessions and goods, and parted them to all men, as every man had need. Acts 2:44-45

6 Cooperatives: Cooperatives are based on: o Voluntary and open membership o Control of the organization by its members. o Sharing of contributions and benefits by members.

7 Now there are diversities of gifts, but the same Spirit. And there are differences of administrations, but the same Lord. And there are diversities of operations, but it is the same God which worketh all in all. 1 Corinthians 12:4-6

8 Cooperatives: Cooperatives enjoy some tax benefits. Since they are not corporations, they do not pay income tax on their earnings as long as they handle those earnings in certain ways. At least 20 percent must be paid out to members. Members of course, must pay personal income taxes on that money. The cooperative invests as much as 80 percent of its earnings to expand its operations.

9 Cooperatives: Cooperatives and co-ops are found in many industries from farming and energy to health care. They fall into three main categories: consumer or purchasing cooperatives; service cooperatives; and producer cooperatives. Any group of consumers or producers with common social or economic goals can band together to form a cooperative.

10 Consumer Cooperatives: Retail outlets owned and operated by consumers are called consumer cooperatives or purchasing cooperatives. Consumer cooperatives sell merchandise to their members at reduced prices. By purchasing goods in large quantities, these cooperatives can obtain goods at lower cost.

11 Consumer Cooperatives: They then pass their savings on to members by setting prices low. Examples of consumer cooperatives include discount price clubs, CD or book clubs etc. Examples are Costco and Price Club

12 Service Cooperatives: Cooperatives that provide a service, rather than goods, are called service cooperatives. Some service co-ops offer discounted insurance, banking services, health care, legal help and baby-sitting services. Credit unions or financial cooperatives are a special kind of service cooperative. People deposit money in these institutions. The credit unions then use those funds to lend money to members at reduced rates.

13 Producer Cooperatives: Agricultural marketing cooperatives help member producers sell their products. These co-ops allow members to focus their attention on growing their crops or raising their livestock. The co-ops meanwhile market these goods for the highest price possible.

14 Nonprofits Some institutions function much like business organizations, but do not operate for the purpose of generating profit. For that reason they are called nonprofit organizations. Nonprofit organizations are usually in the business of benefitting the public. Examples include museums, hospitals, churches, etc. And many other groups and charities. Almost all provide a service rather than goods.

15 Nonprofits o The government exempts nonprofit organizations from income taxes. o The non profit must meet certain requirements to qualify for this tax exempt status. o They cannot issue stock so profits cannot be distributed to share holders.

16 Nonprofits o The group must devote its activities exclusively to those that the Internal Revenue Service says will qualify. o For example, charity groups must act only to help people, such as the poor and disabled by illness or injury. o Education nonprofit must devote itself to the advancement of learning, etc.

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18 Professional Organizations o Work to improve the image, working conditions and skill levels of people in particular occupations. o Such examples include the American Medical Association, American Bar Association, etc. o Professional organizations keep their members up-to-date on industry trends.

19 Professional Organizations o Many of these organizations provide members with employment related services such as job boards and training workshops and networking opportunities. o They also set code of conduct that members are expected to follow.

20 Professional Organizations o Business Associations promote the collective business interests of a city, state, or other geographical area or for a group of similar businesses. o Business Associations may also address codes of conduct just as professional associations do. o The Better Business Bureau sponsored by local businesses, is a non-profit group with the aim to protect consumers by promoting an ethical and fair marketplace.

21 Trade Associations: o Nonprofit organizations that promote the interest of a particular industry is called trade associations. o Many of these groups hire lobbyists to work with state legislature and the American congress to try to influence laws that affect their industry. o Labor Unions: Is an organized group of workers whose aim is to improve working conditions, hours, wages, and fringe benefits for its members.