Q.State the limitations of a Cooperative Society.

Most limitations of a cooperative society trace back to its modest-capital membership base and the democratic, government-supervised way it is run.

A Cooperative Society faces several genuine limitations:

1. Limited capital-raising capacity — since members are usually of modest means and the society cannot raise funds from the general investing public the way a company can through shares and debentures, available capital is often small.
2. Management inefficiency — the managing committee is generally elected members serving in an honorary or part-time capacity, who may lack a company's professional management expertise.
3. Excessive government control — as a body registered under a Cooperative Societies Act, it is subject to significant government supervision over audits, elections, and administration, which can limit its own flexibility.
4. Lack of secrecy — accounts and dealings are open to member scrutiny and government audit, making commercial secrecy far harder to maintain than in a JHF business. …

Students sometimes list 'unlimited liability of members' as a limitation of a cooperative society — this is incorrect; a cooperative society's members a …