If you have incorporated your business as an S Corporation or a C Corporation, most states require that you keep careful records of the company’s activities. Every time your board of directors meets, your company needs to keep a record on file for regulatory compliance purposes.
There is a long list of possible transaction and resolutions that you might need to keep on record. This can include anything ranging from:
- The appointment of a new officer.
- The resignation of a director.
- Purchasing insurance.
- Selling stock
- Obtaining a line of credit/credit card in the company’s name.
Keeping records can be a lot to keep straight, particularly for the small business owner. However, proper meeting minutes are essential to keeping your corporation in good standing and maintaining your personal liability shield. Below are some of the key things you need to know when it comes to keeping minutes of your meetings.
What are Meeting Minutes?
Meeting minutes keep an official account of what was done or talked about at formal meetings, including any decisions made or actions taken.
They are taken during a formal meeting of the board of directors or shareholders of a corporation, such as initial and annual meetings. Typically, meeting minutes are recorded by the corporation’s secretary (or another individual appointed at the meeting).
What Should be Included in Meeting Minutes?
Your meeting minutes do not need to include every little detail. You just need to document the key information and any decisions made or actions taken. In general, your minutes should be detailed enough to serve as your corporation’s “institutional memory.”
Typical minutes will include the following:
- Basic information about the meeting: date, time, location.
- Who attended, along with a special note in the cases where attendees came late or left early.
- Agenda items with a brief description of each item.
- Voting actions with a detailed account of how each individual voted, along with any abstensions.
- Time when meeting was adjourned.
In most cases, you don’t need to create minutes from scratch. You can find free templates online to serve as a starting point. Choose your type of minutes/documentations, fill in the blanks, and print it out, and you will have met your recordkeeping obligations.
Who is Required to Keep Meeting Minutes?
The majority of states require both S Corporations and C Corporations to document major business decisions and the major meetings you hold.
At present, the following states do not require minutes to be kept:
- North Dakota
Additionally, LLCs are not required to keep minutes.
What Should I do With the Minutes After They are Recorded?
Minutes do not need to be filed with the state, but can instead be kept with your other corporate records, such as articles of incorporations, bylaws, and resolutions.
Like other documents, you should keep minutes on hand for at least seven years. Members of the corporation, such as shareholders, officers, and directors, are entitled to review the meeting minutes upon “reasonable request” to the corporation.
While you don’t need to file these documents with the state, they should still be considered important documents and are essential for protecting your corporation’s good standing and your limited liability status.