In order to ensure financial discipline, extensive provisions have been enacted. No part of the fund other than net profit shall be distributed among members (Sec.62). Investment of society's fund only in recognized securities is permissible (Sec.64). Contribution to political parties or loans to non-members or borrowing from external sources are prohibited. Annual auditing by recognized auditors is mandatory (Sec.65). Central Government may direct for special audit if it is of the opinion that the society's affairs are not being managed in accordance with the co-operative principles or prudent commercial practices (Sec.77).
A Multi state cooperative society is of various types - Credit, Housing, Agriculture, Transport, Hospital, Sugar, Stores, Fishery, Handloom, Labor, Customer and Multi Function Co-operative Society. The basic formalities for forming this society are to arrange at least 50 members from two states each along with address proofs.
These professionals are supported by appropriate office infrastructure and an exhaustive database of support documentation. A cooperative society registered under MSCS Act 2002 is the best option in today's scenario for doing public collections and providing them returns as there is no SEBI, RBI or MCA interference.