Protect Your Company with Meeting Minutes

October 25, 2021

Keeping meeting minutes has traditionally been thought of as something that only corporations and big businesses need to worry about.

But even if your business isn’t required by law to keep meeting minutes, having them can provide valuable supporting evidence in the event of a lawsuit or tax audit.

Here’s what you need to know about keeping meeting minutes.

Background

You should generally record minutes at meetings that involve significant company decisions or actions. This will likely include meetings with executives, directors, shareholders, and officers.

Creating a record of decisions, actions and responsibilities is especially important when any kind of related-party transactions occur (such as payments, loans or distributions between the company and its owners). For example, the IRS may challenge the amount of compensation paid to a business owner as unreasonable. Meeting minutes that document the factors considered by the board in approving the compensation can be a strong defense against such a challenge.

Tips for keeping minutes

Meeting minutes need not be lengthy, but they must provide a clear record of corporate actions and the business factors that are considered when those actions are taken. Here are some tips to help you take and keep effective minutes:

• Take minutes! If you’ve been lax about taking minutes, now is the time to get back on track. Record minutes for any meeting that involves big decision-making and company actions. These minutes are key for fiduciary and liability purposes.
• Use a template. Get in the habit of using the same format for meeting minutes. Using a standardized template will make it easier for the minute-taker and provide clarity and organization if needed as legal evidence in the future.
• Include information that matters. Meeting attendees, absentees, location, and date and time of the meeting are necessary, but your minutes should also include the results of decisions and details about important activity in the company, not just who said what.
• Sign and approve the minutes. Make your minutes official by having the appropriate people sign off. This is typically done by the board secretary, and in some cases, the president. The president also usually approves the minutes.
• Keep minutes in a safe place. Store meeting minutes in a safe and accessible place. Confirm that only designated people have access to the minutes.