| (1) |
For purposes of this regulation "reportable irregularity" means any act of omission committed by any person responsible for the management of a co-operative, which— |
| (a) |
unlawfully, has caused or is likely to cause material financial loss to the co-operative or to any member, creditor or investor of the co-operative in respect of his, her or its dealings with that entity; or |
| (b) |
is fraudulent or amounts to theft; or |
| (c) |
causes or has caused the co-operative to trade under insolvent circumstances. |
(2)
| (a) |
An independent reviewer or auditor of a co-operative that is satisfied or has reason to believe that a reportable irregularity has taken place or is taking place in respect of that co-operative must, without delay, send a written report to the registrar. |
The report must give particulars of the reportable irregularity referred to in paragraph (a) and must include such other information and particulars as the independent reviewer considers appropriate.
| (4) |
The independent reviewer or auditor must as soon as reasonably possible but not later than 20 business days from the date on which the report referred to in sub regulation (2) was sent to the registrar— |
| (a) |
take all reasonable measures to discuss the report referred to in sub-regulation (2) with the members of the Board of the co-operative; |
| (b) |
afford the members of the Board of the co-operative an opportunity to make representations in respect of the report; and |
| (c) |
send another report to the registrar, which report must include— |
| (i) |
a statement that the independent reviewer is of the opinion that— |
| (aa) |
no reportable irregularity has taken place or is taking place; or |
| (bb) |
the suspected reportable irregularity is no longer taking place and that adequate steps have been taken for the prevention or recovery of any loss as a result thereof, if relevant; or |
| (cc) |
he reportable irregularity is continuing and |
| (ii) |
Detailed particulars and information supporting the statement referred to in subparagraph (i). |
| (5) |
The registrar must as soon as reasonably possible afford the Board of the co-operative the opportunity to make representations in respect of the report and to rectify the position. |
| (6) |
If the matter cannot be resolved to the satisfaction of the registrar he or she may investigate the matter and notify any appropriate regulator in writing of the details of the reportable irregularity. |
Municipal Demarcation Act, 1998
