For most business owners, the process of keeping corporate minutes can be an irritating formality. After all, you’re already busy juggling the steady stream of day-to-day tasks associated with running and growing your business. However, keeping minutes, even for a one-owner company, can help you stand up in court and protect your limited liability shield if needed.
Below are some tips to make keeping Minutes as pain-free and effective as possible.
Record only formal meetings
Minutes need to be kept only for formal meetings or key decisions; you don’t need to take Minutes for informal meetings (although some companies find it useful)Examples of meetings and actions that require Minutes include:
- Board meetings
- Annual director and shareholder meetings
- Employee hires or raises
- New officers
- Issuance of new stock
- Financial activities: new bank accounts, loans, credit cards
Record all the key details
You should include the following details in your Minutes:
- Full name of your company
- Meeting logistics: date, time, and place
- Name of individual conducting the meeting
- Attendance: list of who attended and who was absent
- All actions taken, such as purchases, elections, etc.
- Signature of recorder and date
When you’re deciding how detailed to make your Minutes, keep a few things in mind:
- You’ll need to record the motions that were voted upon, who moved them and who seconded them. Include a detailed vote count (number of “for” and “against”).
- You’re not required to record the discussions of the motions (and we all know, these can be lengthy!); you just need to record the motions themselves.
- Your corporate Minutes are private, until someone suing you subpoenas your records or you’re audited by the IRS. Just keep this in mind when deciding how detailed your recordkeeping should be.
- You may wish to document financial or business decisions that might be questioned by others (i.e. shareholders, spouses, etc.) later on. From time to time in business matters people change their mind or forget what was decided; having detailed documentation of each vote taken will help squash any sticky situations down the road.
With every formation, CorpNet™ provides you with Corporate Minutes documents that you can customize to your needs. Should you need additional or stand-alone documents, call us at 888-449-2638. We’ll help you out.
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