Appropriate record keeping

In dealing with clients that own their own businesses, the question often comes up on what records to keep and what can be tossed. All businesses, whether they are service, manufacturing or sales, have to fight the mountain of records that must be maintained to understand and grow that business.

Even with the electronic process of scanning, some amount of grooming of records needs to occur so that important records are neither lost nor take forever to find. A lot of experts have expounded on the various categories of what to keep and what to toss. The following is a general offering of what should and should not be kept. Every business operator, regardless of what type of widget they make, should evaluate their individual circumstance, however. If there is a specific question, be sure to contact your CPA, financial advisor or business attorney.

Good luck,

Randy Fisher

Business correspondence                                                                                           3 years

Employee personnel records (after the employee
has been terminated)                                                                                                    3 years

Employment applications                                                                                           3 years

Insurance policies (for policies that have expired)                                         3 years

Settled accident claims                                                                                                7 years

Cancelled checks for standard transactions                                                        7 years

Invoices from vendors                                                                                                 7 years

Time books                                                                                                                        7 years

Bank statements and reconciliations                                                                      9 years

Audit reports of CPAs                                                                                            Permanent

Cancelled checks for key payments (taxes, purchases of

property, special contracts)                                                                               Permanent

Contracts and leases in effect                                                                             Permanent

Corporate minute books for directors and stockholders                       Permanent

Capital stock and bond records                                                                         Permanent

Deeds, mortgages and bills of sale                                                                    Permanent

General and private ledgers                                                                                Permanent

Property records                                                                                                     Permanent

Tax returns, worksheets and related documents                                       Permanent

Trademark registrations                                                                                       Permanent

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