End of Year To-Dos for Small to Midsize Businesses

Catchy title, eh?  I know, I know, most business owners are more concerned about trying to make sure they can pay Christmas bonuses than about doing EOY scutwork.  Here's a great reason to be concerned about getting your annual meeting minutes done: LIABILITY.

Whether you're an LLC, a corporation, a limited partnership or any other business entity that protects its investors, making sure you're doing the things that companies do is the best way to ensure that when you get sued, the plaintiff's attorney can't "pierce the corporate veil" and send the sheriff out to seize the Monet you have hanging in the bathroom.  One of the most important things that companies do is to have documentation of the things that were done by the company that year.

Enter the annual meeting minutes (or a unanimous consent in lieu of annual meeting).  This document is a record of things like:

• buying or selling real property and vehicles used in the business
• starting a 401k for your employees
• bringing in new members/shareholders/partners (or bidding them adieu)
• making distributions of profit
• approving new growth or business opportunities

A lot of small business owners are so concerned about working "in the business" that they forget how important it is to work "on the business" - which includes making sure the documentation is correct and complete.   Want to get a business loan?  The bank wants to see this stuff.   Applying for a license?  The government wants to see this stuff. 

At the Jacobson Law Firm, P.C., we send out reminders to our corporate clients that include a worksheet for getting their thoughts together to prepare for the annual meeting, or for having us prepare a Unanimous Consent in Lieu.  Your attorney or CPA may do that as well.  It's a helpful tool to make sure you have the documentation you need when you need it.  Nobody might ever ask to see your corporate book, but if they do, these documents help protect you from liability.  They also serve as a handy reference when you need to know who did what, when, how and why.  Annual minutes - don't forget them in the year-end rush.