I previously talked about why I became a Law Clerk and my role with corporate matters in the firm. This is a big part of what I do for our clients and I wanted to expand on that thought, so that’s what today’s Blog is about.
As a Corporation, Federal or Provincial, there are a few things that need to be maintained yearly in order to be compliant, one of which is annual meetings of shareholders and directors, and the recording of them, i.e. Annual Minutes or Resolutions. We call this annual corporate record keeping.
Once the financial statements have been prepared by your Accountant and delivered to you, you should reach out to your corporate lawyer to let them know that you are ready to have with your Annual Resolutions prepared. Why wait until after you receive your financial statements? That is where you will know if any bonuses or dividends have been paid and these are required to be reflected in the Annual Resolutions as part of the record keeping.
As part of our service, we don’t wait to hear from you for your financial information. Approximately three months after your financial year end, our offices will reach out to you to see if you have received the information from your Accountant and ask questions that will assist our office in preparing the Resolutions.
Pursuant to the Ontario Business Corporations Act (OBCA), and the Canada Business Corporations Act (CBCA), a corporation is required to maintain their corporate records. Failure to do so can result in significant penalties such as fines, with the officers and directors being personally liable for those fines. For this reason, please don’t ignore the request from your corporate lawyer, which is probably more accurately a request from a Law Clerk like me.
We’re to help things run smoothly and avoid the necessity of rushing to make your Minute Book current (because of a purchase or a corporate audit), and will save you stress and money.
So next time you get that email from your lawyer asking for your year end information, get your response to them to avoid any unnecessary expense and make life easier for a Law Clerk like me !