The annual meeting presents an ideal opportunity to show- case the cooperative. The people, the physical assets, and member benefits all should be acknowledged. The meeting provides a means to develop cooperative understanding and a desire for further cooperative action. The articles of incorporation or bylaws decree the legal necessity of the meeting, but the underlying purpose is an informed and educated membership on the benefits and responsibilities of ownership. The starting point could be a reiteration of the principles and practices of cooperation and a cards-on-the-table approach to the facts about cooperatives. Cooperative-specific topics like the mechanics of a member equity revolving fund or allocation of net income or loss keep members in touch with their cooperative.

The information and education portion of the annual meeting should be the meat of the program for members.

Financial Explanations

The financial statements may be presented by the manager, the treasurer, or another officer, depending on who is best equipped for the job. Most associations also arrange to have a representative of the auditing firm present.

Regardless of who has the assignment, the report should be prepared and presented carefully. Ordinarily, a statement of operations, a balance sheet, and a statement of cash flow are included. Operating costs should be fully explained and compared with those of the previous year. Assets, liabilities, and a members' equity section should be similarly discussed and compared. Any significant changes should be pointed out and explained.

The effectiveness of the financial report depends as much upon the manner in which it is presented as upon its contents. Too often, a good report loses significance because members are unable to follow the speaker and grasp the meaning of what is said. This happens for two reasons. First, the average person is not familiar with the form of such reports nor with many of the terms commonly used in accounting. Terms such as "accrued assets," "long-term liabilities," and "reserves for depreciation" often leave members cold, so they need to be explained in simple language.

Second, many reports are read too rapidly and contain poorly organized material. More graphic illustrations and fewer words can remedy this situation.

Assets sometimes need to be presented in terms of "what the association owns" and liabilities in terms of "what the association owes." Ordinarily, it isn't enough to point to a figure and call it "depreciation." The speaker needs to go further and discuss the rate at which the costs of certain assets are being written off and to explain why this is considered good business practice.

Because of the nature of the financial report, the speaker must deal in terms of numbers. However, to stand before a group of people and read, one by one, items on an operating statement or balance sheet is not an effective way of presenting this type of information. It mostly goes in one ear and out the other.

Members should have before them a copy of any overhead projection being discussed. A chart in front of the room, but large enough for all to see, might be useful. Data can be put on a slide or overhead transparency and projected on a screen, with printed copies distributed to the members.

Individual items on the financial statement are often more significant when compared with certain other items. For example, the amount of money spent for salaries and wages has little significance except when compared with gross margins or the total volume of business transacted.

Losses from bad debts do not mean a great deal unless it is known how much business was done on credit.

Repairs for machinery and equipment mean most when we know how much machinery was being used; slides of major projects help to clarify expenditures.

The figure representing "total assets" is not of much significance when it stands alone. The important things to know are how much of these assets does the association actually own and how much represents borrowed capital?

Discussion Periods

Allotting reasonable time for discussion is an important principle of good annual meeting planning.

Discussion may be encouraged in numerous ways. A first step is to reserve definite periods on the program for discussion. Another is to develop the atmosphere: "This is your meeting; we value your suggestions and questions."

Some leading cooperatives use the workshop technique with excellent results. When the members move into the dining hall for their luncheon or dinner, they find that each table accommodates six. During the meal, each group selects a speaker and agrees on some topic or question they would like to hear discussed by a panel of the management staff. Or they may divide into smaller groups during the regular meeting period and come up with questions.

At a subsequent session, officials and board members sit on the stage. A moderator then refers each question to the appropriate person for explanation or discussion.

These workshop discussion groups give members a chance to get things off their chests. Moreover, the fact that six people must have agreed on a question before it is submitted helps eliminate trivial items and improve the quality of questions asked.

Referring each question to the departmental head directly responsible for that phase of the cooperative's operation means that it will get the best attention possible. It also gives members a chance to become better acquainted with key employees of their cooperative. Elected directors should also participate in answering the members' questions.

A variation of the above is to arrange for a panel of selected individuals to discuss some timely topic. This is a good way to present key cooperative leaders to the meeting

Under the guidance of a good leader, such a panel discussion can be highly informative. After members of the panel present their ideas and exchange points of view, the topic can be discussed from the floor. In this manner, participation by members is further encouraged.

Talks by Outside Speakers

Guest speakers frequently address annual meetings. Such talks may fall under the category of "entertainment" as well as "information." If the guest speaker is well known or holds an important position, his/her presence may add prestige to the association in the eyes of the members. Such an appearance on the program may also help to increase member attendance.

Guest speakers, therefore, may be invited for their own sake, for the message they have, or for both reasons. They need not be prominent if they have a valuable contribution to make.

A prime consideration when deciding whom to invite is the prospective speaker's understanding of the economic and political climate in which the cooperative operates. Also, the encouragement and enthusiasm the speaker can bring to the association should be considered. The speaker should be sympathetic to association objectives.

Whatever the reason for the invitation, terms for the guest's coming should be clearly stated. The guest may be assigned a subject or given some latitude, as the planning group thinks best. A time limit should be set for the presentation. Background information will help a speaker who is not familiar with the group to be addressed.

As valuable as a guest speaker may be, the speaker should not be regarded as a substitute for other rightful parts of the annual meeting. The main emphasis should always be on the active participation of members in the business of their associations.