Analysis of the statutory changes to adapt the share capital reimbursement regime to the co-operative accounting standards

Abstract

Purpose: The objective of this study is to analyze the changes made in the co-operative Statutes to adapt the share capital and which have been the economic effects of this adaptation to the economic and financial situation of the co-operatives.

Design/methodology/approach: To conduct the study we asked for the Statutes and the financial statements of the co-operatives, for the period 2010-2011, to the Register. First, we have studied the Statutes to revise which articles have been introduced or modified in relation to the new accounting standards. Second, we have created a database with the financial statements of the co-operatives in order to analyze the economic and financial situation through an analysis of the balance sheet data and ratios.

Findings and Originality/value: We have identified the percentage of co-operatives that have decided to adapt the Statutes to the accounting normative and the criteria that they have adopted. The results conclude that mainly co-operatives have adapted their Statutes, and the effects of the application of accounting standards adapted to IAS 32 consist of a decrease in equity and an increase in its debt.

Research limitations/implications: The difficulty to obtain the financial statements and the Statutes of the co-operatives in Catalonia.

Practical and social implications: Since 2011, all co-operatives in Spain must apply accounting standards adapted to IAS 32. The results of this research can be useful for different stakeholders, not only for the co-operatives, but also for other co-operative bodies that can make their appropriate assessments, and for the financial institutions, that can take them into account when they take decisions.

Originality/value: There are not many studies that deal with this issue. The present study allows to know what mechanisms have been used for co-operatives to adapt their share capital to the accounting standards and to analyse if this accounting reform affects substantially their patrimonial and economic situation.