New fact sheet outlines evolution of equity in co-ops

MANHATTAN With rising incomes, Kansas grain, oilseed and farm supply cooperatives have boosted their total equity levels or levels of net worth to historical highs.

Equity generation and composition are important topics for any cooperative, said Brian Briggeman, director of the Arthur Capper Cooperative Center (ACCC) at Kansas State University. Generating equity capital is critical because it can be used to finance growth through capital investments, absorb business losses, and help secure a loan, as well as be used for other business purposes.

Equity represents the members' ownership interest in the total assets of the cooperative. Cooperative equity comes in two forms, allocated and unallocated, Briggeman explained. Allocated equity is the amount assigned, on a proportional basis, to each member. Unallocated equity is not designated to specific member accounts.

The ACCC dives into this subject in a new fact sheet titled, "Equity Composition of Kansas Grain, Oilseed and Farm Supply Cooperatives," that is available online at

While equity levels and composition vary from cooperative to cooperative, some general trends have developed throughout the industry, and Kansas is not that different, Briggeman said. The first trend is higher equity levels for co-ops. Since 2003, Kansas co-ops' total equity, along with total savings or total net income, has risen significantly.

Another trend is the rise in the percentage of total equity designated as unallocated equity or permanent equity capital on Kansas co-op's balance sheets. One question that often arises is, what is the appropriate amount of unallocated equity within a cooperative? Answering this question is difficult because there is no one correct answer that fits all cooperatives, Briggeman said. However, the new fact sheet provides discussion points for a cooperative's board of directors and management team to consider on this topic.

More information is available by contacting Briggeman at or (785) 532-2573.

KFSA acquires local insurance agency

KFSA, one of the state's largest insurance agencies and a leader in providing risk management services across the Midwest, has announced the purchase of the Garden City based Rutter Cline Associates, Inc. Insurance Agency. The acquisition was finalized in late November 2012.

With offices in Hutchinson and Dodge City the Rutter Cline purchase gives KFSA the opportunity to better serve the insurance needs of its customers not only in western Kansas but also across the region.

KFSA President Mitch Williams said the acquisition of the Rutter Cline Agency joins together two very strong companies that share similar goals. "It allows us to diversify and access more markets so that we can continue to provide quality services and offer an even wider range of products to our customers. I am pleased to welcome Ric Gudding and his staff to our team."

Ric Gudding, former owner of Rutter Cline and current General Manager, will continue managing the Garden City agency and its employees. "I spent considerable time searching for the right company to join forces with and KFSA fit the mold very well. Their views on customer service and a strong focus on Western Kansas make them a great partner."

"For me it was important that my employees would continue to have a stable and comfortable environment in which to work." Gudding said. "After two months of working together, KFSA has been true to their word making the transition very easy for everyone at RCA."

KFSA's purchase of the Garden City agency brings the total amount of insurance and risk management professionals serving under the KFSA name to 81.