Kathmandu, April 4: Nearly half of the 1,900 cooperatives operating under the purview of the Kathmandu Metropolitan City (KMC) have failed to submit their regular reports, according to the KMC’s Cooperatives Department. The fact that many cooperatives do not submit reports regularly means that there are problems in such cooperatives. The Department said that out of about 1,900 cooperatives operating within its jurisdiction, only 723 regularly submit annual reports. Dhruba Kumar Kafle, Chief of the Department, said the Metropolis has been repeatedly requesting submission of annual reports regularly. If annual reports are not submitted for a long time under various excuses, the Metropolis said that it preparing to take legal actions against those non-compliant cooperatives. Kafle mentioned, “Some cooperatives are completely out of contact while others avoid reporting due to ongoing investigations against them. Cooperatives that have disbursed loans illegally have the practice of not submitting reports regularly.” According to him, instructions have already been issued to the non-complaint cooperatives to conduct their annual general meetings and submit audit reports, decisions of the annual general meetings and the annual report to the Metropolis’s concerned Department. He informed that if cooperatives do not submit general assembly reports for an extended period, they are taken into the liquidation process which, he added, could put depositors’ money at risk. Thus, the Metropolis first collects reports and only then proceeds with the liquidation process, he explained. Advisory for depositors Meanwhile, the KMC has urged the depositors not to be lured by the gimmick of the cooperatives such as offering unusually high interest rates. Kafle called upon the depositors to verify whether a cooperative is operating legally, conducting regular audits and maintaining financial transparency and is subjected to regularly oversight before depositing money. He suggested, “One must stay away from the mindset that ‘this is my friend’s cooperative’ or ‘a relative runs it’, so I can deposit money without giving it a without thorough verification.” ‘Such assumptions and blind trust could lead to financial loss,’ he cautioned. Authorities note that many cooperatives are currently facing problems because they are being run among known people themselves. Also, there are issues due to the absence of regular legal procedures that should be followed.
