Section 34: Disposal of profit.

(1) A registered society shall not pay a dividend or bonus or otherwise distribute any part of its net surplus except as provided under this Act and until the proposal payment or distribution has been approved by the committee of the Society.
(2) At least one fourth of the net profits of a registered society as ascertained by the audit report, shall be paid into a fund to be called the "reserve fund" which shall be applied as specified in this Act, but the Director may in case of any registered society of limited liability grant, from time to time, exemptions from further contributions to the reserve fund, or reduce the rate thereof, and may at any time revoke the exemption or reduction.
(3) A registered society may, with the approval of the Director, and after one fourth of the net profits in any year has been paid into a reserve fund, contribute an amount not exceeding ten per cent of the remainder of the net surplus to an education fund.
(4) A registered society or an officer or a member thereof who wilfully neglects or refuses to comply with any of the provisions of subsection (1) or (2) of this section is guilty of an offence and liable on conviction to a fine of N1,000 or to imprisonment for a term of six months or to both such fine and imprisonment.
(5) In the case of a society of unlimited liability, no distribution of the net surplus shall be made without the approval of the Minister or Commissioner, as the case may be.