How to Keep Corporate Records

Maintaining thorough and comprehensive records is an important aspect of any business, regardless of its entity status. Aside from helping to organize documents in an immediately accessible manner, corporate record-keeping involves a number of legal, managerial, and tax-related regulations to which businesses are obliged to adhere.

Business owners and proprietors should first acknowledge the distinction between that of bookkeeping - which generally applies to accounting and financial measures such as company expenses, cash flows, and bank transactions - and that of corporate records, which are legal documents outlining the various organizational, structural and correspondence operations of the business.

While bookkeeping is a separate task, well-kept records can dramatically help accountants and tax professionals come tax season and even result in substantial financial savings. Accordingly, it is in the interest of accountants as well as proprietors to maintain corporate records.

These documents outline the various procedures of the business and how it shall be run, including shareholder structure and responsibility and Board of Director assignments. Corporations register these documents as their bylaws, and LLCs record them as Operating Agreements.

These are the primary records of interior deliberation, correspondence and meeting procedures. Resolutions refer to the decisions and structural measures determined by the Board of Directors, typically in a Limited Liability Company. The minutes are extensive documents outlining the various issues, agreements and proceedings of corporate meetings. They are to be drafted, circulated and approved by the Board of Directors or other relevant principals. For more information on keeping corporate minutes, see "How to Track Corporate Minutes".

Most corporate entities, Limited Liability Companies and Limited Liability Partnerships are obligated to file annual reports according to the provisions of the state or commission in which the company operates.

This refers to all money that is owned to the company. Documentation should include an "aging" reference that signifies the duration or the date of due payments. Similarly, accounts payable should also be documented. For more information on keeping corporate books, see "How to Keep Corporate Books".

This document should be consistently updated, noting all changes in stock holdings as well as a full list of every shareholder - old and new.

While all correspondence should ideally be documented, communication with shareholders, in particular, should be afforded special attention. This includes copies of all email, direct mail or facsimile documents.

In the event a business is dissolved, this document is filed with the corresponding corporate commission.

• All corporate documents should be thoroughly copied and filed alphabetically according to client, shareholder or operational relevance.
  
  
• A corporate records guidebook can provide record-keepers or new hires with a resource for easily locating certain files and documents.
  
  
• Keep back-up copies of all records either on-site or at a separate storage facility. If documents are to be sent from the workplace, make copies and store them in a relevant location.
  
  
• Small companies should devote a certain amount of time each week toward maintaining or updating their corporate records. Large firms may be required to create a new position that deals specifically with record-keeping.


• If you have questions about best practices when it comes to ongoing corporate compliance and record keeping, please visit our corporate compliance forum.