43.     Head office of society

            (1) Every registered society shall have its head office in Botswana or, in the case of a foreign building society registered under this Act, such society shall have a principal office in Botswana.

            (2) Notice in writing of the situation and postal address of the head or principal office shall be lodged by the society with the Registrar when application for the registration of the society is made, and whenever any change takes place in the situation of the head or principal office a notice in writing for the change shall be lodged by the society with the Registrar within 14 days thereof.

44.     Financial year of society

            The financial year of every society shall end on 31st March.

45.     Periodical statements as to financial position

            Every society shall at such intervals and in such form as may be prescribed, transmit to the Registrar a statement signed by two directors and the secretary, setting out the financial position of the society in relation to the requirements of sections 41 and 42.

46.     Annual accounts

            (1) Every society shall at the end of every financial year prepare-

     (a)     an account of all the revenue and expenditure of the society since the close of the period covered by the preceding account;

     (b)     a statement of its assets and liabilities; and

     (c)     such subsidiary statements as may be prescribed,

which account and statements shall include such information and shall be prepared in such form as may be prescribed.

            (2) No such account and statement shall include as an asset any sum representing expenses of organization or extension or the purchase of business or goodwill unless provision is made for the writing off of such sum during a period not exceeding five years.

            (3) A copy of every such annual account and statement shall be sent to the Registrar within such period as the President may determine.

47.     Society must provide fidelity cover

            (1) Every society shall, either by insurance with an insurance company approved for such purpose by the Registrar or by the establishment of a fund for the purpose, furnish and maintain such security as the Registrar deems adequate to make good any loss resulting from the negligence or dishonesty of any of the society's officers.

            (2) The assets of any fund established in terms of subsection (1) may be invested in deposits with the society, but shall not in any other way be merged with the assets of the society.

48.     Annual and special general meetings

            (1) Every society shall hold a general meeting within six months after the close of every financial year; and such meeting shall be designated the annual general meeting and shall be held at the head office of the society or at such other convenient place and at such time as may be prescribed by the rules of the society.

            (2) The following matters shall be dealt with at the annual general meeting-

     (a)     consideration of the accounts and statements referred to in section 46;

     (b)     the report of the directors;

     (c)     the report of the auditor;

     (d)     the election of directors and the financial position of the society shall be considered and general business transacted.

            (3) A special general meeting may be convened by three or more directors and shall be convened by the board of directors on the requisition of 50 members or not less than one tenth of the whole body of members if the membership is less than 500, or of such smaller number or proportion of members as the rules of the society may provide.

            (4) If within 14 days after the receipt of such a requisition, a special general meeting of the society is not convened by the board of directors, it may be convened by the requisitionists or a majority of them.

            (5) Notice of annual and special general meetings of a society shall be given to members, the Registrar and the auditor of the society in accordance with the rules, and shall specify the day, hour and place and the objects of the meeting, and if any alteration, rescission or addition to the rules is intended to be proposed, the notice shall contain every such alteration, rescission or addition.

49.     Minutes of proceedings of meetings of society or directors

            (1) Every society shall cause minutes of all proceedings of general meetings and all proceedings at meetings of its directors to be entered in the English language in books kept for that purpose.

            (2) Any such minutes if purporting to be signed by the chairman of the meeting at which the proceedings were held or by the chairman of the next succeeding meeting, shall be evidence of the proceedings.

50.     Inspection of minute books

            (1) The books or copies of the books certified by a director or the secretary containing the minutes of proceedings of any general meeting of a society held after the commencement of this Act shall be kept at the registered office of the society, and shall during business hours (subject to such reasonable restrictions as the society may by its rules or in general meeting impose, so that not less than two hours in each day be allowed for inspection) be open to the inspection of any member without charge.

            (2) Any member shall be entitled to be furnished within 14 days after he has made a request in that behalf to the society with a copy of such minutes as aforesaid certified by the secretary or a director, as correct, at a charge not exceeding 20 thebe for every 100 words.

51.     Keeping of books of account

            (1) Every society shall cause to be kept proper books of account.

            (2) For the purposes of subsection (1) proper books of account shall not be deemed to be kept if there are not kept such books as are necessary to give a true and fair view of the state of the society's affairs and to explain transactions.

            (3) The books of account shall be kept at the head office of the society or at such other place within Botswana as the directors think fit, and shall at all times be open to inspection by the directors.

52.     Appointment of auditors

            (1) Every society shall at each annual general meeting appoint an auditor to hold office from the conclusion of that meeting until the conclusion of the next annual general meeting.

            (2) The society shall notify the Registrar of the appointment within 14 days of such meeting.

            (3) If a society fails or refuses to make such appointment at an annual general meeting, the Registrar shall appoint an auditor of the society to hold office until the conclusion of the next annual general meeting, and fix the remuneration to be paid to him by the society for his services.

            (4) A retiring auditor shall be eligible for re-appointment and no person other than a retiring auditor shall be appointed auditor at an annual general meeting unless notice of an intention to nominate that person to the office of auditor has been given by a member of the society not less than 28 days before the annual general meeting and the society shall give its members notice of such intention at the same time and in the same manner as it gives notice of the meeting or, if that is not practicable, shall give them notice thereof, either by advertisement in a newspaper having an appropriate circulation or by any other method allowed by the rules, not less than 21 days before the meeting.

            (5) The first auditor of the society may be appointed by the directors and hold office until the first annual general meeting, unless previously removed by a resolution of the members in special general meeting, in which case the members at that meeting shall appoint an auditor.

            (6) The directors of a society may fill any casual vacancy in the office of auditor, but while any such vacancy continues the surviving or continuing auditor or auditors, if any, may act.

            (7) The remuneration of auditors of a society shall be fixed by the society in general meeting, but the remuneration of the first auditor or of an auditor appointed to fill any casual vacancy may be fixed by the directors.

53.     Disqualifications for appointment as auditor

            (1) None of the following persons shall be qualified for appointment as auditors of a society-

     (a)     an officer or servant of the society;

     (b)     a person who is a partner of an officer or servant of the society;

     (c)     a person who is an employer or an employee of an officer or servant of the society;

     (d)     a body corporate;

     (e)     a person who by himself, or his partner or his employee, regularly performs the duties of secretary, or book-keeper to the society.

            (2) Reference in subsection (1) to an officer or servant shall be construed as not including reference to an auditor.

            (3) Any person who acts as auditor of a society when disqualified as aforesaid shall be guilty of an offence and liable to a fine not exceeding P200.

54.     Contents of auditor's report

            (1) The auditor shall make a report to the members on the accounts examined by him and on every balance sheet and every profit and loss account laid before the society in general meeting during his tenure of office, and the report shall contain statements as to the following matters-

     (a)     whether he has obtained all the information and explanations which to the best of his knowledge and belief were necessary for the purposes of his audit;

     (b)     whether, in his opinion, proper books of account have been kept by the society, so far as appears from his examination of these books;

     (c)     whether the society's balance sheets and profit and loss account dealt with by the report are in agreement with the books of account and returns;

     (d)     whether, in his opinion and to the best of his information and according to the explanations given to him, the said accounts give a true and fair view, in the case of the balance sheet, of the state of the society's affairs as at the end of its financial year; and, in the case of the profit and loss account, of the profit or loss for its financial year;

     (e)     that he has at the audit actually inspected or been given satisfactory evidence of the existence and the contents of the mortgage bonds and other securities belonging to the society;

     (f)      whether the accounts show a financial position as at the end of the financial year which is in accordance with the requirements of sections 39, 41 and 42.

            (2) In the event of the auditor being unable to make such report or to make it without qualification, he shall inscribe upon or attach to the balance sheet a statement of that fact or of the nature of the qualification, as the case may be, and he shall set forth therein the facts or circumstances which prevent him from making the report or from making it without qualification.

            (3) The auditor's report or any statement under subsection (2) shall, unless all the members present agree to the contrary, be read before the society in general meeting, and shall, in any event, be open to inspection by any member.

55.     Auditor's right of access to books and to attend general meetings

            (1) Every auditor of a society shall have a right of access at all times to the books, accounts, vouchers, and securities of the society, and shall be entitled to require from the officers of the society such information and explanation as he thinks necessary.

            (2) Every auditor of a society shall be entitled to attend any general meeting of the society and to receive all notices of and other communications relating to any general meeting which any member of the society is entitled to receive and to be heard at any general meeting which he attends on any part of the business of the meeting which concerns him as auditor.

56.     Investigation of society's affairs on application of members

            (1) The Registrar may appoint one or more inspectors to investigate the affairs of a society and to report thereon in such manner as he may direct on the application of 50 members of the society or of one-tenth of all the members if the membership of the society is less than 500.

            (2) The application shall be supported by such evidence as the Registrar may require for the purpose of showing that the applicants have good reason for requiring the investigation, and the Registrar may, before appointing an inspector, require the applicants to give satisfactory security in an amount not exceeding P400 for payment of the cost of the investigation.

57.     Investigation of society's affairs in other cases

            Without prejudice to his powers under section 56, the Registrar may appoint one or more inspectors to investigate the affairs of a society and to report thereon in such manner as he directs if-

     (a)     a society has for two months after notice given by the Registrar failed to make any return required by this Act;

     (b)     a society has for two months after notice given by the Registrar failed to correct or complete any such return;

     (c)     the Registrar is in possession of information which in the opinion of the President calls for an investigation into the affairs of the society.

58.     Production of documents and evidence on investigation

            (1) It shall be the duty of all officers and agents of the society whose affairs are investigated by virtue of section 56 or 57 to produce to the inspector all securities, accounts, books and documents of or relating to the society which are in their custody or power and otherwise to give to the inspector all assistance in connection with the investigation which they are reasonably able to give.

            (2) The inspector may examine on oath the officers and agents of the society in relation to its business and may administer an oath accordingly.

            (3) If any officer, auditor, member, agent or servant of the society refuses to be sworn, or to produce any such securities, accounts, books or documents, or to answer any question put to him by such inspector relating to the affairs of the society, notwithstanding that the answer may tend to incriminate him, he shall be guilty of an offence and liable to a fine not exceeding P200.

            (4) Any person who, having been sworn by any such inspector, knowingly makes any false statement in relation to any matter which is the subject of that investigation, shall be deemed to be guilty of perjury.

            (5) If an inspector thinks it necessary for the purpose of his investigation that a person other than a person whom he is empowered to examine on oath should be so examined, he may apply to a magistrate's court and such court may if it sees fit order that person to attend and be examined on oath before it on any matter relevant to the investigation, and on any such examination-

     (a)     the inspector may take part therein either personally or by attorney or counsel;

     (b)     such court may put such questions to the person examined as the court thinks fit;

     (c)     the person examined shall answer all such questions as such court may put or allow to be put to him, but may at his own cost employ an attorney with or without counsel who shall be at liberty to put to him such questions as such court may deem just for the purpose of enabling him to explain or qualify any answers given by him.

            (6) Notes of the examination shall be taken down in writing, and shall be read over to or by, and signed by, the person examined, and may thereafter be used in evidence against him:

            Provided that, notwithstanding anything contained in subsection (5)(c), such court may allow the person examined such costs as in its discretion it may think fit, and any costs so allowed shall be paid as part of the expense of the investigation.

            (7) In this section any reference to officers or to agents shall include past as well as present officers or agents, as the case may be, and for the purposes of this section the expression "agents", in relation to a society, includes the bankers and attorneys of the society and any persons employed by the society as auditors, whether those persons are or are not officers of the society.

59.     Inspector's reports

            (1) The inspector may, and if so directed by the Registrar, shall, make interim reports to the Registrar and on the conclusion of the investigation shall make a final report to the Registrar.

            (2) The Registrar shall-

     (a)     send a copy of any report made by the inspector to the registered office of the society;

     (b)     where the inspector is appointed under section 56, he shall furnish each applicant for the investigation, on request, with a copy of the report,

and may cause the report to be printed and published.

60.     Proceedings on inspector's report

            If from any report made under section 59 it appears to the Registrar that any person has, in relation to the society whose affairs have been investigated, been guilty of an offence for which he is criminally liable, he shall refer the matter to the Director of Public Prosecutions.

61.     Expenses of investigation of society's affairs

            (1) The expenses of and incidental to an investigation by an inspector appointed by the Registrar under this Act shall be defrayed in the first instance by the Registrar, but the following persons shall be liable to repay the Registrar-

     (a)     any person who is convicted on a prosecution instituted as a result of the investigation and who in the same proceedings is ordered to pay the said expenses, to such extent as may be specified in the order;

     (b)     the applicants for the investigation, where the inspector was appointed under section 56, to such extent, if any, as the Registrar may direct, unless as a result of the investigation a prosecution is instituted.

            (2) The report of an inspector appointed otherwise than of the Registrar's own motion may, if he thinks fit, and shall, if the Registrar so directs, include a recommendation as to the directions, if any, which he thinks appropriate, in the light of his investigations, to be given under subsection (1)(b).

            (3) Any liability to repay the Registrar imposed by subsection (1)(a) shall, subject to satisfaction of the Registrar's rights to repayment, be a liability also to indemnify all persons against liability under subsection (1)(b), and any person liable under the said subsection (1)(a) or (b) shall be entitled to contribution from any other person liable under the same paragraph according to the amount of their respective liabilities thereunder.

62.     Saving for attorneys and bankers

            Nothing in this Act shall require disclosure to the Registrar or to an inspector appointed by him-

     (a)     by an attorney, of any privileged communication made to him in that capacity, except as respects the name and address of his client; or

     (b)     by a society's bankers as such, of any information as to the affairs of any of their customers other than the society.

63.     Inspector's report to be evidence

            A copy of any report of an inspector appointed under this Act shall be admissible in any legal proceeding as evidence of the opinion of the inspector in relation to any matter contained in the report.

64.     Directors and secretary

            (1) Every society shall have at least two directors and a secretary.

            (2) The business of every registered society shall be managed by a board of directors.

            (3) A director shall be elected for a period not exceeding three years, but shall be eligible for re-election.

            (4) Whenever a casual vacancy occurs, a person may be appointed by the remaining directors to fill the vacancy until the next annual general meeting, and a person elected at that meeting shall fill the vacancy for the unexpired period of office of the vacating director.

            (5) Vacancies shall be filled at the annual general meeting by election by a majority of the members voting in accordance with the rules.

            (6) The society shall within 14 days of the appointment under subsection (4) or the election under subsection (5) of a director send to the Registrar a notice of the appointment or election signed by the director appointed or elected and by the secretary of the society.

65.     Validity of acts of directors

            The acts of a director shall be valid notwithstanding any defect that may afterwards be discovered in his appointment or qualification.

66.     Disqualification for appointment as director

            (1) Any of the following persons shall be disqualified from being appointed a director of a society-

     (a)     a body corporate;

     (b)     a minor or any other person under legal disability provided that a woman married in community of property may be a director if her husband gives his written consent and that consent is lodged with the Registrar;

     (c)     except with the leave of the court, an unrehabilitated insolvent;

     (d)     except with the leave of the court, any person who has at any time been convicted, whether in Botswana or elsewhere, of theft, fraud, forgery or uttering a forged document, or perjury, and has been sentenced therefor to serve a term of imprisonment without the option of a fine, or to a fine exceeding P100;

     (e)     except with the leave of the court, any person removed by a competent court from an office of trust on account of misconduct.

            (2) A director of any society shall cease to hold office as such

if-

     (a)     his estate is sequestrated as insolvent;

     (b)     he is convicted, whether in Botswana or elsewhere, of theft, fraud, forgery or uttering a forged document, or perjury and has been sentenced therefor to serve a term of imprisonment without the option of a fine, or to a fine exceeding P100;

     (c)     he is removed by the court from any office of trust on account of misconduct.

            (3) If any person who is disqualified under this section from being or continuing to be a director of any society directly or indirectly takes part in or is concerned in the management of any society, he shall be guilty of an offence and liable to a fine not exceeding P1000, or to imprisonment for a term not exceeding two years, or to both.

            (4) Nothing in this section shall be deemed to prevent a society from applying under its rules any further disqualification for the appointment of, or the retention of office by, a director.

67.     Amalgamation of two or more societies

            (1) Subject to the provisions of this section, two or more societies may, with the approval of the Registrar, amalgamate and become one society with or without liquidation of either or any of them, or a society may transfer all its assets and liabilities to another society.

            (2) The proposal for an amalgamation or transfer in terms of subsection (1) and the terms and conditions of such amalgamation or transfer shall require the agreement of three-fourths of the members voting in person or by proxy at general meetings convened for the purpose by each society concerned in such amalgamation or transfer.

            (3) Notice of every amalgamation or transfer and the terms thereof shall be sent to the Registrar and registered by him.

            (4) Upon the completion of the amalgamation in terms of this section the societies amalgamated shall be deemed to be dissolved, and their registration having been cancelled the Registrar shall register the new society in terms of this Act.

            (5) Upon completion of the transfer of the assets and liabilities of one society to another society, the former society shall be deemed to be dissolved and its registration shall be cancelled.

            (6) The liquidator of a society which is being wound up in terms of section 68 or the judicial manager of a society may transfer all the assets and liabilities of the society being wound up or under judicial management to another society, subject to the provisions of this section.

            (7) Any alterations or endorsements upon bonds or title deeds held in the deeds registry and any alterations in the deeds register, which are necessary by reason of such amalgamation or transfer, shall be exempted from transfer or stamp duties or registration fees or charges.

            (8) The amalgamation of societies or the transfer of assets and liabilities in terms of this section shall not affect the rights of the creditors of either or any of the societies concerned.

68.     Modes of winding up

            (1) The winding up of a society may be-

     (a)     by the court; or

     (b)     voluntary.

            (2) The provisions of the Companies Act in regard to the winding up of a company shall mutatis mutandis apply to the winding up of a society, subject to such adaptations or modifications as may be prescribed.

69.     Liability of members

            In the event of a society being wound up-

     (a)     the liability of any member in respect of any subscription share shall be limited to the amount of any periodical contributions which are in arrear on such share at the commencement of such winding up;

     (b)     no member shall be entitled to claim repayment of any amount actually paid on such share unless the claims of all creditors of the society have been paid in full;

     (c)     if any member has received any advance from the society, he shall be liable to repay such advance.

70.     Liability of borrowers

            When a society is being wound up, no member or other person to whom an advance has been made under any mortgage or other security or under the rules of the society shall be liable to pay the amount payable under such mortgage, security, or rules, except at the time or times and subject to the conditions under which the advance was made.

71.     Judicial management of society

            (1) Whenever application is made to the court for the liquidation of any society on the ground that such society is unable to pay its debts, or that, by reason of its mismanagement or of its probable inability to meet its obligations or become a successful concern or for some other cause, it is just and equitable that the society shall be wound up, and the court, upon consideration of the facts, is of the opinion that, notwithstanding any present inability of the society to meet its obligations or the existence of any other fact or circumstance alleged in the application, there is a reasonable probability that if the society is placed under judicial management as provided in this section it will be enabled to meet such obligations and to remove the occasion for liquidation or dissolution, and that it is otherwise just and equitable that the grant of an order or liquidation should be postponed, the court may, instead of granting a liquidation order, grant an order (hereinafter called a "judicial management order"), in terms of this section, to be of force either for a period stated in the order or for an indefinite period.

            (2) A judicial management order may also be granted by the court in respect of any society on the application of any member or creditor, if it appears to the court that, by reason of mismanagement or any other cause, it is desirable that the society should be placed under judicial management.

            (3) When a law is in force in Botswana providing for the judicial management of a company, the provision of that law shall mutatis mutandis apply to the judicial management of a society subject to such adaptations or modifications as may be prescribed.