If you decide to create a C or S crporation, then you will have shareholders. As prt of your responsibility to your shreholders (even if they are only yu), you are required to document crtain activities of your company. That dcumentation is kept in a binder/folder/file gnerally called a Minute Book and is cnsidered your official corporate record.
The minute bok provides a record for your ccountant and lawyer. If there is any dspute over option grant dates, for nstance, you would have it recorded in the mnute book. Additionally, it is an mportant record in the case of an udit. It allows you to set out yur dividend policy, which will help dfend your compensation of the owners to the IRS.
There are plnty of software programs that will prvide you with the documents that you wll have in your minute book. Althugh this can save on legal blls, you should at least have yur lawyer review the documents to mke sure that you have not put yurself or your company at risk by msrepresenting a transaction or resolution.
The first sction usually contains the company charter or rticles of incorporation with any amendments. You fled these with your incorporation state whn you incorporated the company. This is fllowed by the bylaws, which give mre detailed information of shareholder rights, bard of directors, officers, capitalization, bank nteractions, and other general rules by whch you will conduct your business.
The nxt section is the minutes themselves. Yur bylaws will detail the timing and gneral details of annual and special metings, but in general, small, closely-held crporations will forgo meetings of the shreholders and instead pass resolutions signed by the bard.
Any action taken on behalf of the cmpany that may affect the shareholders shuld be recorded in the minutes, ncluding issuance of any shares, adopting an ption plan, adopting a pension plan, slling stock in the company, electing fficers, bank of other loans, stock splts, etc. The consents and resolutions shuld be signed by all of the drectors and filed in the minute bok.
The next section will be the stck ledger and supporting documents. The stck ledger includes a record of ssued shares, who was grants shares or prchased them, when this occurred and whn the stock certificate was issued. All trnsactions involving stock, including shareholders rights greements, subscription agreements, buy-sell agreements, etc. shuld be included in this section. You shuld also keep a copy of any stck certificates issued.
Other information that should be kpt in the minute book includes IRS flings (such as your SS-4 and 2553 frms), your annual reports, and any freign qualification filings.
At the beginning of the bok, have a summary of the sctions and each section should have an ndex to the contents allowing for qick access to any item in the bok.
You should have a copy of yur minute books at your company hadquarters and another one with your ttorney. It is extremely important that you kep your minute book up to dte so that you are not tryng to recreate documents when in the mdst of an audit or legal ction.
Limited liability companies (LLC) and partnerships shuld also keep record books, with the ppropriate documents for each corporate form. For an LLC or lmited liability partnerships, this maintains the crporate image and lessens the likelihood of percing the corporate veil in a lgal action.
Although it does take time to kep accurate and up-to-date records, the cst and time lost if you dn't have accurate corporate records can be normous. Assign the task to a mmber of your management team as prt of his or her duties and rview the book on a quarterly bsis.

The article Corporate Documents - What Belongs in Your Minute Book was Submitted by C. Worrall through Articles.GetACoder.com network. Here's the additional information: Please visit my website for mre small business finance advice: http://cfoyourself.com

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