“Minute Books” – what is it and why is that important?

Jan 2, 2016

There are many reasons to keep your minute books up to date.

First, is that this is the company’s legal obligation in accordance with the law. For the government officials, minute books of the corporation provide a proof of the corporate structure, the identity of its officers, directors, and shareholders, current and past obligations of the corporation, and various shareholders’ agreements.

Second, your financial institution will request properly organized and up to date Minute books during any financing or loan arrangements for the corporation. Organized minute books serve as a proof that the corporation is being managed properly and in compliance with the relevant legislation. Moreover, organized Minute books provide an indication to banks that company’s managers and directors are business savvy and knowledgeable in a proper management of their company.

Third, and similarly to the second, many experienced or institutional investors will have a similar approach. Properly managed Minute books will serve as another positive point in evaluating your business and the risks of investment.

Finally, Minute books will provide managers and directors of a corporation with a historical overview of the corporation’s development and growth. Review of historical resolutions of the Board of Directors, appointments of officers and other relevant business information will provide current managers and directors with a valuable information relating to various stages that the corporation passed on the way of its business development.

And remember, it is relatively easy and straightforward to keep your Minute books up to date. No special knowledge needed and with a simple training, any business manager will be able to ensure the company’s Minute books are always up-to-date. However, neglecting this simple task may result in high costs and expenses that any business will have to spend once requested to produce Minute books (then you will have to make it urgently and probably with assistance of a costly lawyer).

Contact us at CBES.ca for further information and training for the Minute books maintenance.

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