As part of a good estate plan for a businessowner, it is important to ensure the business documentation is current and easily accessible to the executor. Keeping up-to-date documentation will minimize the risk of an oversight by the executor or a mistake resulting from obsolete documentation.

What documents should be kept current? Here is a non-exhaustive list:

Corporate minute book – it is important for the corporate minute book to be maintained and up to date as this is likely the first reference for the executor. The corporate minute book provides information as to:

• The date of incorporation
• Date(s) of articles of amendment (with the details of the amendments),
• The terms of the different classes of shares,
• Who are the shareholders (with copies of the share certificate(s)), the directors and the officers,
• All past corporate reorganizations, and
• The shareholders agreement.

Business valuation – it is not uncommon for a businessowner to have a business valuation for a corporate restructuring (implementing an estate freeze as an example). Adding such documentation in the corporate minute book will provide an indication of the value of the business at a specific time and an idea of the value of the shares on that date. This can be helpful when reconciling the financial information.

Corporation’s financial statements – the financial statements provide an indication of the company’s finances. The financial statement provides some information for the executor and may assist them in the immediate decisions to be made.

Balance sheet – to the executor, it is important to understand the assets, the liabilities and the capital of the business(es). The balance sheet will provide key financial information of the business which may allow the executor to make informed decisions expediently.

Tax accounts, payroll account and HST account – a copy of the corporation’s latest tax assessment and the payroll account should be kept, as well as confirmation that the HST account is up to date. Such documentation will indicate if there are any outstanding tax debts and whether the corporation is in good “tax standing” (which will come as welcome news to the executor).

Corporate organization chart – sometimes, the corporate structure is complex. It is not uncommon to see a corporate structure that includes several corporations, a trust and partnership interests with ownership interest in all the entities. Without an up-to-date corporate organization chart, it is nearly impossible for the executor to make sense of the structure in place.

Corporate life Insurance documentation – if there is a life insurance policy owned by the corporation, such documentation needs to be easily available to the executor. First, this document will provide information on the capital dividend account of the corporation (after the date of death) which can allow some tax planning strategies (and some funds to be distributed on a tax-free basis to the estate/beneficiaries).

Conclusion

Keeping the above documentation available and current will ensure optimal efficiency to the executor and allow the business(es) to thrive during this period of uncertainty. The opposite is also true; a lack of documentation will create unnecessary delays in the administration of the estate and possible errors in the administration of the business because of o