Keeping records
is an important part of running a business. Obvious benefits of keeping records include being organized, keeping track of important forms (e.g., incorporation forms, 2553, etc.), and having a set of documents that outlines how you plan to run your business. Perhaps less obvious benefits include standardized stock certificates, transfer ledgers, an operating agreement, and a resolution to borrow/lend. Like I said before, sending in the forms to the state to get your business set up is the easy part!
A closer look
at the elements of a corporate record book could leave you a little confused and in need of some aspirin. With a little time and a lot of patience, you can get your head around the contents. It is very important that you know what each section contains – both from a general content standpoint and the nitty gritty specifics. The contents of this book outlines how you plan to run your business and provides the necessary forms to complete/document certain activities within your business.
What to expect
Corporate record books do vary a little in content. You can find some that are a bit meatier than others. Choosing the right one for your business is going to require a little homework. If you’re a single person operation, less may be more for you in the beginning. If you’re starting something with a half a dozen other people, your requirements probably look slightly different. In any case, here are a few things that I would expect to see in any corporate record book.
Forms:
- Notice of (shareholder) meeting
- Meeting minutes – shareholders and/or directors
- Waiver of notice of meeting
- Written consent to action w/o meeting
Resolutions:
- S corp election
- Borrow and/or lend money
- Real property
- Amending operating agreement/bylaws
- Stock issuance
Getting started
with a corporate records book isn’t difficult. Many websites out there will sell you a binder that comes with many of the “standard” forms ready to go. The Corporate Records Handbook by Anthony Mancuso is a good book to pick up to help you work through your own records book. I’ve also had some luck on this site in the past for picking up a good starter book for a reasonable price. Good luck on this important component of getting your business up and running. Now I’m going to end this blog post and head back to my own corporate records binder and make some updates.
Disclaimer: I am not an attorney. The information above is based on my experience. Make sure to do your homework, consult the appropriate legal representative, and be ready to take full accountability for your actions (or lack there of).
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