MINUTE BOOKS. ARE THEY NECESSARY AFTER INCORPORATION?

Minute Books. Are they Necessary After Incorporation?

Yes, they are.

A corporate minute book provides corporate stakeholders with access to the corporation's history and key decisions. This transparency fosters trust and facilitates better decision-making. Shareholders can track their ownership shares, understand board decisions, and stay aware of the company's strategic direction through these records.

Corporations operating in Ontario and Canada have statutory obligations under the Ontario Business Corporations Act (“OBCA”) and the Canada Business Corporations Act (“CBCA”) to stay compliant by preparing their annual minutes and resolutions, filing their annual returns and maintaining an updated corporate minute book. All corporate records from incorporation to business sale or dissolution should be maintained in a minute book binder to mitigate risks of legal penalties. Traditionally, minute books were hardcover binders filed away in the corporate head office or their solicitor's office. These days, most corporations go by a virtual minute book, easily accessible to them online.

Your minute book should have documents such as articles of incorporation, articles of amendment, articles of amalgamation, bylaws, meeting minutes, resolutions, contracts, individuals with significant control registers (ISC),  shareholders' ledgers and registers.

A well-managed and up-to-date minute book enhances financial transactions, such as securing loans or attracting investors. Financial institutions and potential investors usually perform due diligence checks on minute books to assess corporate health and management credibility. It could be an indication of a company's stability and operational integrity.

Summary

Having a well-maintained corporate minute book and updated corporate records is not just a legal requirement for corporations in Ontario and Canada, the practice supports governance, financial health, and overall operational efficiency. Regularly updating these records ensures compliance, facilitates financial opportunities, and enhances stakeholder engagement, ultimately contributing to the success and sustainability of the corporation.

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Written by Jumi Odepe, Principal Lawyer, Jode Law

If you have questions about minute books and incorporating your business, reach out to the business lawyers at Jode Law via email at lawyers@jodelaw.ca

The articles published by Jode Law are intended as general information only and do not serve as legal advice. By reading, the reader understands there is no solicitor-client relationship established. If you have a legal question, consult a lawyer.