Non-profit making organizations have gained more popularity in recent times in Nigeria. Just like profit making organizations must satisfy the need of their different stakeholders as at when due, non-profit making organizations have the responsibility to meet the need of their members or beneficiary at the appropriate time. This call for the question of how liquid and risky is the liquidity base of non-profit making organizations. Consequent upon this fact, this study examined the liquidity risk of non-profit making organizations in Adekunle Ajasin University, Akungba Akoko, Ondo State focusing on cooperative societies operating in the institution. The study made use of primary data which were sourced from members of selected cooperative societies through the administration of questionnaires. The study employed multistage sampling technique to ensure that the cooperative societies are well represented. The cooperative societies were stratified into four strata and simple random sampling method was adopted to randomly select the respondents across each stratum. A total of forty (40) questionnaires were distributed and collected. The study employed descriptive statistics and percentages to analyze the collected data.
The result revealed that cooperative societies in Adekunle Ajasin University respond to members request quickly and grant full amount of loan requests made by members. However, it was discovered that there was no significant relationship between liquidity risk of the cooperative societies and their quick response to loan request. Also, it was discovered that salary of members is the source from which contributions are made to their cooperative societies and so it is reliable and contributions are made promptly. Furthermore, the result showed that interest rate chargeable on loan is cheap and also terms of loan are appropriately structured to ensure convenience of repayment.
The study concluded that non-profit making organizations (cooperative societies) in Adekunle Ajasin University are liquid to meet the requests of their members as at when due and also the riskiness of their liquidity base is very low given the promptness of members contributions as well as repayment of loan according to schedule. Deductions by bursary at source and prompt remittance should be sustained and wholesale funds providers should leverage on the liquidity of cooperative societies to grant loans at mutually beneficial margins.
Non-profit organization, Cooperative Societies, Liquidity, Risk, Contributions
