|Capital Credits (margins) are
to a cooperative what profits are to a private business. Because
we are a member-owned entity, IEC strives to operate all segments
of operation at cost. As a result, any margins (profits) are
returned to you the customer. Your share of these margins is
called Capital Credits.
How are Capital Credits Allocated?
At the end of the year, net margins are allocated to each
customer in proportion to the customer's cooperative purchases
during the year. The Board
of Trustees usually decides when to retire Capital Credits
based on the cooperative's financial condition in October
or November. In the meantime, IEC utilizes the money as working
capital for operating and reinvesting in the cooperative until
a determination is made.
A detailed financial report is available online in the 2005