11

2

Corporate Minutes & Annual Registration

Kept in the Minute Book/ binderQuality Control by bookkeeper

“Know what you should know”

“Know what you should not do”

3

Minute Book & Bookkeeper

• Inaccurate structure would restrict tax strategies

• Interrupt the income tax filing requirement abruptly

• Lose ability to borrow from financial institutes

• Lose ability to sell corporation shares & qualify for SBCGD.

• Lose corporate status (struck from registry).

• Lose credible status of company

• Lose dividend payment to shareholder ability

• Lose protection of shareholders’ (& directors’) personal belongings (assets)

Consequence of inaccurate management:

4

Know What You Should KnowWhat is a Minute Book?

Is the book (binder) which keeps the key documents together about the creation of the corporation.

Is a central location that contains vital records of history of the running's of a corporation.

When Do You Use a Minute Book?

Created when a corporation starts.

Presented for legal or regulatory authorities.

5

Know What You Should Know

Who prepares the contents and index list:

• annual corporation renewal

• annual meeting notes (minutes)

• routine resolutions (decisions)

• Incorporation Papers

Who files updated info to appropriate areas?

6

Know What You Should KnowANNUAL REGISTRATION

(ANNUAL RENEWAL OF NAME)

Annual Return Reminder to Renew Corporation Name may be completed with the local registry office once the details are confirmed by the legal representative.

MEETINGS & DECISIONS (RESOLUTIONS)Directors & Officers Decisions (resolutions) An annual meeting which results to a Resolution is

required by the officers & directors to accept the financial statements and their board position appointed in the corporation. This may become a routine document reproduced if no changes from the one initially prepared by legal representative

Any decisions passed by directors, officers & or shareholders should be recorded routinely with the assistance of legal & tax accounting assistance.

7

Know What You Should KnowIncorporation Papers

It is law that governs Canadian corporate statutes that obligates a corporation to maintain a Minute Book.

On rare occasions statutory penalties may be assessed for failure to attend to the Minute Book.

Various third parties may want or need to examine the corporate minute book including the accountants, bankers or Canada Revenue Agency or federal/provincial authorities.

If the business sells, the purchaser may want legal opinions relating to various matters.

Keeping the Minute Book up to date will make the entire selling process easier and likely less expensive.

8

Know What You Should Know

• Prepared by Registry Office

• Birth Certificate:

• date of birth

• legal name

• provincial registry number

CERTIFICATE OF INCORPORATION

9

Know What You Should Know

• Prepared by a Legal Representative

• Details of structure

• Shares authorized (ownership)

• Continuance with Application, if applicable.

ARTICLES OF INCORPORATION / CONTINUANCE

10

Know What You Should Know

BY-LAWS

• Prepared by a Legal Representative

• Rules on how to run the company

• What services the company may provide

• Who can arrange and sign for debts and contracts, etc.

1111

Know What You Should Know

SHAREHOLDERS MEETINGS including resolutions

• Suggestions on agendas for meetings may be provided by the bookkeeper, tax accountant, management.

• Legal opinion should be sought on when a shareholder meeting requires a resolution be prepared and documented by a solicitor.

1212

Know What You Should KnowDIRECTORS MEETING

including resolutions

• Appointment of the accountant for the year

• Recording all declared dividends for the year

• Recording all management bonuses paid

• Suggestions on agendas for meetings may be provided by the bookkeeper, tax accountant, management.

• Legal opinion should be sought on when a Directors’ meeting requires a resolution be prepared and documented by a solicitor.

1313

Know What You Should Know

NOTICES

• Important notifications to a corporationProvided by 3rd party

• Income Tax & GST Notice of Assessments

• Any filings or registrations with the Government and Regulatory Authorities

1414

Know What You Should KnowMORTGAGE REGISTER INCLUDE LOANS

When a corporation receives a mortgage, record this information in the corporate minute book.

The information filed here is best provided by the financial institute paperwork:

• Date & Type & Purpose of Mortgage• Short Description of Property Mortgaged.• Amount of Mortgage• Name of Mortgagee or persons entitled to

mortgage payments• Where and when registered or filed• Date of satisfaction discharged or cancellation.

1515

Know What You Should Know

FINANCIAL STATEMENTS

In this section you would keep a copy of the annual financial statements, preferably signed.

The Small Business Corporation Act requires Audited Statements unless authorized by the Directors & or Officer to approve unaudited.

1616

Know What You Should Know

DISCLOSURE REGISTER

Statutory or good faith revelation of a material fact on a financial statement or in the accompanying notes (footnotes).

Items of information; that is not generally known.

1717

Know What You Should Know

UNANIMOUS SHAREHOULDER AGREEMENT

The Legal Agreement written between shareholders that may document the relationship to the exit strategy of the company or distribution of profits or buyout details or Estate issues.

This document is best prepared by a legal representative.

1818

Know What You Should KnowSECURITIES REGISTER

This section of the minute book would be where the records of share distribution for the corporation are kept.

Information needed:• Name and address of share recipient• Class of shares• Date• Number of Certificate Issued• Number of Certificate Cancelled• Transfer number• To or from whom• Paid up• Sold shares• Bought shares• Balance

1919

Know What You Should Know

SHAREHOLDERS LEDGERS AND TRANSFERS

Recording all shareholder loans made to/paid by the corporation for the prior year

Particulars of share transfers

Information needed to record• Transfer (transaction) number• Date• Class of shares• Certificate Surrender # & Shares• Name of Transferor• Name of Transferee• Address • Certificate Issued # & Shares• Signature of Transferor or Attorney

2020

Know What You Should Know

SECURITY CERTIFICATES

Copy of Share Certificate

Prepared by Legal Representative

Info on Security Certificate• Cost of share• Class of share• Number of shares• Shareholder name• Corporation name

2121

Know What You Should Know

DIRECTORS REGISTERS

This section is where all the information of the company’s directors and officers is recorded

Information to be recorded• Full Name• Address• Occupation• Date When Appointed or Elected• Date When Ceased to Hold Office• Position Held

2222

Know What You Should KnowANNUAL RETURNS - Proof of Filing

Details on the completed annual return:

• Directors & Shareholders names with the addresses on file

• Relationship to corporation

• Shareholder % of voting shares

• Shareholder residency – Canada: Yes or No

• Corporations location of Records & Registered Office

• Registration Authorized by

2323

Know What You Should Know

CONTRACTS

Legal Arrangements between Corporation and 3rd Party.

Considerations to Legal Representation must be decided by Company Shareholders & Directors!

2424

Know What You Should Know

Minute Book – Other Info

Copies of completed income tax returns filed with notice of assessment in NOTICES section of Minute Book

25

Know What You Should NOT Do

Do NOT create the initial records for a minute book.

Do NOT represent the contents of a minute book for the basis of legal opinion.

Do NOT update the contents with out legal representation.

2626

Helpful Products & Toolswww.c2online.ca

Corporation Minute Book Resolution Authorization Dividend SF293vb

Corporation Minute Book Article ‘A’ share-Example SF117

Corporation Minute Book Index SF118vd

Year End Disbursement Authorized SF481vb

Year End Folder Checklist SF215vrrr

Financial Statement Booklet 003.xls

Convention Agendas: several different topics that may be used as Shareholder & or Directors’ meetings.

27

Know What You Should Know

QUESTIONS?

2828

Thank You

2929

Poll Questions4. What does a partnership or proprietorship keep their business information in?Answer: There is no regulatory authority that governs these business types to have

any minute book. We do recommend that a similar storage binder be set up.6. What is the difference between a resolution & meeting?Answer: A resolution is the conclusion (decisions) obtained by a meeting.14. How long does the company keep original Loan & Mortgage Documents?Answer: Seven years after the last payment transaction on the financials not 7 years

since the opening dates.20. What 3 sections in the Minute Book must have matching information?Answer: The security register and the security certificate and shareholders’ transfers 21. Why should a director request the corporation provide liability insurance

coverage when they are not a Shareholder?Answer: If the corporation is sued by any one, this lawsuit could involve the

directors.22. What Minute Book item is the most commonly neglected & misunderstood task

and should be Quality Controlled by the bookkeeper?Answer: The filing of the annual return with directors and shareholders resolution.