Many business owners elect to end their fiscal year on the calendar year. This provides a great time to reflect on business plans and entity maintenance requirements. Failure to do so can not only stifle business growth and evolvement but may result in significant and unnecessary risk. While each business is different, here is a short checklist of topics to address:
- Entity Maintenance – Update your business registry with the Secretary of State. Many states, including California and Hawai’i, now allow you to sign up for an email reminder to assist with your annual reporting requirements. Don’t forget to hold and document an annual meeting if your bylaws or incorporation articles require it. Failure to do so may result in exposing the owners to personal liability.
- Update Owner Agreements – When was the last time you reviewed your operating agreements, bylaws, buy-sell agreements, or employee ownership plans? Set aside some time at the end of the year to step back and reflect on your progress and the direction of your business. Revise your 3- and 5-year plans. If you don’t have these yet, now is a good time to create them.
- Contract Review – Leases, employment contacts, purchase and sales agreements: most businesses tend to pick a format and stick with it. When was the last time you reviewed yours to make sure they contain all the things you need, and don’t contain the things you don’t want? Having an attorney periodically review these documents can help your business thrive and grow in the coming year.
- Benefit and Retirement Plans – If you have a retirement plan for your employees, the end of the year is a good time to review your plan for compliance. Most plans have notice requirements that need to be documented. If you have an ERISA plan, make sure your ERISA bond covers the proper amount of plan assets. If you have an employee health care plan, you may have certain reporting requirements under the Affordable Care Act. Now is a good time to begin compiling the needed data to prepare the required forms.
Takeaway
Make sure you calendar time year to review and update your essential business documents. Need assistance with your business planning in the upcoming year? Contact CASHMAN LAW today for a free consultation to see how we might help you plan your business growth.
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