BusinessCorporate Records – What to Keep

Corporate Records – What to Keep

-

- Advertisment -spot_img

Whether you’ve created a corporation or limited liability company, you must maintain records. Here’s a primer on the basic corporate records you need to maintain. 

Corporate Records

When forming a corporation or limited liability company, you are creating an entity independent from yourself. In doing so, this independent entity must take actions for itself, not you. 

For instance, a corporation will have a corporate bank account through which all revenues and debt payments are handled. 

As a shareholder, even with a single shareholder entity, you will not pay personal expenses out of the corporate bank account. This concept extends to record keeping. 

For the purpose of this article, I am considering both corporation and limited liability company documents as “corporate records.” Although the records of each entity have different names, they serve the same purpose. 

For instance, articles of incorporation for a corporation serve the same purpose as Articles of Organization. The following list applies to corporations, but you can apply the list to the limited liability equivalents. 

Although each state has different records requirements, all require you to keep the following records:

1. Articles of Incorporation – The charter establishing the existence of the entity with the relevant Secretary of State. 

2. Bylaws – The rules of the corporation. Essentially, the bylaws set out how the corporation will be administered from a procedural perspective, the rights of shareholders, how meetings will be called and so on. 

3. Board Resolutions – These are resolutions passed by the Board of Directors from time to time, such as defining classes of corporate stock and approving particular courses of action for the business. 

4. Minutes of Shareholder Meetings

5. Annual Meeting – Every state requires a corporation to have at least one meeting of the board of directors each year. Keep these in your corporate book. 

6. Shareholder Communications – Copies of all communications to shareholders. Most states require you to hold these for three years, but you should keep these permanently to guard against future shareholder lawsuits. 

7. Shareholders – A list of shareholders and the shares they own. 

8. Annual Report – Most states require you to file an annual or bi-annual report with the Secretary of State. Keep copies of these in your corporate records. Most states provide a pre-printed form. 

9. Balance Sheets – Shareholders have the right to inspect the finances of the corporation, although this right has limitations. You need to keep up to date balance sheets. 

10. Tax Returns 

So, how long should you keep these corporate records? Some attorneys will tell you three or five years. 

Personally, I believe you should keep them permanently. If a shareholder dispute occurs, you don’t want to testify through a document. If the business is eventually sold, the buyer is going to want to see all corporate records. Either way, you are better off holding on to all records. 

Disclaimer:  The contents of this site, such as text, graphics, images, and other materials contained on the page are for general information purposes only. This article is not a substitute for professional advice on the topics mentioned. This article does not create any form of offers to any legal or professional service. The site assumes no responsibility for errors or omissions in the contents. In no event shall the site be liable for any special, direct, indirect, consequential, or incidental damages or any damages whatsoever, whether in an action to follow the content, negligence or other tort, arising out of the use of the contents of the article. The blog reserves the right to make additions, deletions, or modifications to the contents at any time without prior notice. The site does not warrant that the site is free of viruses or other harmful components. It may contain views and opinions which are those of the authors and do not necessarily reflect the official policy or position of any other author, agency, organization, employer or company, including the site itself. It also does not provide professional advice, diagnosis, treatment or any legal service. The site does not endorse official procedures, legal actions or qualified services and the use of its contents are solely at your own risk.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest news

Divorce & Health Insurance

Recently, I had a question from someone who was going through a divorce and was concerned about lost health...

Divorce & Health Insurance

Recently, I had a question from someone who was going through a divorce and was concerned about lost health...

Dissolution by Affidavit – Personal Appearance Not Required

The elimination of the requirement of personal appearance for hearing in Missouri dissolution of marriage actions arose out of,...

Discover The Nine Vital Questions You Need To Ask Before Hiring Your Personal Injury Lawyer

Once you know the right questions to ask, hiring your personal injury lawyer is not only easy, but you...
- Advertisement -spot_imgspot_img

Disciplining And Firing Employees

Perception is Reality – Discipline with Care! Disciplining and firing employees is one of the most crucial areas for consideration...

Dental And Medical Collection Legal Guidelines

Every medical and dental practice has to deal with patients who do not pay. If it doesn't deal with...

Must read

Deeds of Variation – Are They Justified?

Deciding to make a Will and then actually putting...

Courtroom FEA: But how does FEA work?

Many legal professionals are exposed to Finite Element Analysis...
- Advertisement -spot_imgspot_img

You might also likeRELATED
Recommended to you