2011 Annual Report - Carolina Farm Credit

Carolina Farm Credit, ACA
At December 31, 2011, allocated members’ equity consisted
of $29,808 of qualified surplus, $51,125 of nonqualified
allocated surplus and $56,958 of nonqualified retained
surplus.
Patronage Distributions
Prior to the beginning of any fiscal year, the Board, by
adoption of a resolution, may obligate the Association to
distribute to borrowers on a patronage basis all or any portion
of available net earnings for such fiscal year or for that and
subsequent fiscal years. Patronage distributions are based on
the proportion of the borrower’s interest to the amount of
interest earned by the Association on its total loans unless
another proportionate patronage basis is approved by the
Board.
If the Association meets its capital adequacy standards after
making the patronage distributions, the patronage
distributions may be in cash, authorized stock of the
Association, allocations of earnings retained in an allocated
members’ equity account, or any one or more of such forms
of distribution. Patronage distributions of the Association’s
earnings may be paid on either a qualified or nonqualified
basis, or a combination of both, as determined by the Board.
A minimum of 20 percent of the total qualified patronage
distribution to any borrower for any fiscal year shall always
be paid in cash.
Dividends
Impairment
Any net losses recorded by the Association shall first be
applied against unallocated members’ equity. To the extent
that such losses would exceed unallocated members’ equity,
such losses would be applied consistent with the
Association’s bylaws and distributed pro rata to each share
and/or unit outstanding in the class, in the following order:
1. Class C Common Stock and Class C Participation
Certificates
2. Classes A and B Common Stock and Class B Participation
Certificates
3. Classes A and D Preferred Stock
Liquidation
In the event of the liquidation or dissolution of the
Association, any assets of the Association remaining after
payment or retirement of all liabilities shall be distributed to
the holders of the outstanding stock and participation
certificates in the following order of priority:
1. Holders of Classes A and D Preferred Stock
2. Holders of Classes A and B Common and Class B
Participation Certificates
3. Holders of Class C Common Stock and Class C
Participation Certificates
2011 Annual Report Carolina Farm Credit
The Association may declare noncumulative dividends on its
capital stock and participation certificates provided the
dividend rate does not exceed 20 percent of the par value of
the respective capital stock and participation certificates.
Such dividends may be paid solely on Classes A or D
Preferred Stock or on all classes of stock and participation
certificates.
The rate of dividends paid on Class A Preferred Stock for any
fiscal year may not be less than the rate of dividend paid on
Classes A, B or C Common Stock or participation certificates
for such year. The rate of dividends on Class A, B and C
Common Stock and participation certificates shall be at the
same rate per share.
Dividends may not be declared if, after recording the liability,
the Association would not meet its capital adequacy
standards. No dividends were declared by the Association for
any of the periods included in these Consolidated Financial
Statements.
Transfer
Classes A and D Preferred, Classes A, B and C Common
Stocks, and Classes B and C Participation Certificates may be
transferred to persons or entities eligible to purchase or hold
such equities.
4. Holders of allocated surplus evidenced by qualified
written notices of allocation, in the order of year of
issuance and pro-rata by year of issuance, until all such
allocated surplus has been distributed
5. Holders of allocated surplus evidenced by nonqualified
written notices of allocation, in the order of year of
issuance and pro-rata by year of issuances first, until all
such allocated surplus has been distributed
6. All unallocated surplus issued after January 1, 1995, shall
be distributed to Patrons of the Association from the
period beginning January 1, 1995, through the date of
liquidation on a patronage basis
7. Any remaining assets of the Association after such
distribution shall be distributed ratably to the holders of
all classes of stock and participation certificates in
proportion to the number of shares or units of such class
of stock or participation certificates held by such holders
E. Other Comprehensive Income (Loss)
The Association reports other comprehensive income (loss)
(OCI) in its Consolidated Statements of Changes in Members'
Equity. The Association reported OCI of $(66), $(862), and
$(9) in 2011, 2010, and 2009 respectively, due to FASB
guidance on employers’ accounting for defined benefit
pension and other postretirement plans (see Note 12 for
further information).
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2011 Annual Report
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