Gordon Dykstra offers a unique “legal consultation” service for small companies who need legal advice about filing annual reports. Call Gordon at 604-853-4793.
Business owners and corporations utilize our services to create annual reports and other financial statements to ensure everything is legal and above board. Although a number of components may come from an accountant, being able to provide the right wording and capabilities in this document could make a significant difference between having shareholders who are satisfied with what is being said, and issues that could result in litigation.
What exactly is an annual report?
An annual report is usually required by medium and large corporations every year to provide an in-depth look into the company’s financial performance and activities throughout the previous fiscal year. There are a number of elements included in financial reports, such as:
- Information on the corporation
- Director/President report
- Chairperson statement
- Auditors report
- Financial statements, including balance sheet; cash flow; and profit and loss
- Notes to the financial statements
- Other features
- Operating and financial review
Any information that would be relevant for the shareholders to know should be included in the annual report. This reports outlines the company’s financial position and where they are headed in the future.
Why use an attorney to create annual reports?
An attorney starts from the beginning. In most cases, large corporations are required to file annual reports, which must be accurate and succinct. An attorney will review the bylaws of the corporation to make sure the report is in compliance with what was set forth, and makes sure you are filing the correct information as required by law.
There are a number of requirements for corporations in Abbotsford, BC in regards to annual reports which include:
- Companies must file an Annual Report with the British Columbia Registry Services within two months of the anniversary of the company’s incorporation date.
- The company must hold its first Annual General Meeting within 18 months of incorporation and at least once every calendar year thereafter, no later than 15 months past the previous annual reference date.
- Directors of the company must approve, sign, produce and publish financial statements in accordance with the relevant regulations unless a waiver is obtained.
- A company must have an auditor appointed, unless the appointment of such auditor is waived by the voting and non-voting shareholders of the company by unanimous resolution.
These are just a few stipulations that are necessary for companies each year. There are a number of documents that are included in addition to the financial statements. Utilizing the services of an attorney ensures your report is ready for your shareholders and any investors that may be interested in your company.
An attorney can also take the elements of your annual report and create a prospectus that is informative enough for potential investors, but does not have as many details as those in the annual report for the shareholders.
Is an evaluation needed to create an annual report?
An attorney will work hand-in-hand with the auditor or accountant to determine the financial health of the organization. Accounting policies must be recognized and followed, and decisions must be made that are reasonable and in the best interest of the company. An attorney will oversee every element of the annual report to make sure everything is included, and your company is protected under the law.An attorney will be able to provide guidance on how to approach certain topics within the annual report, especially if they are not favorable results to keep consistency and a professional approach to the presentation.
Obtaining the right counsel that can properly advise you and help strategically guide you in the right direction is key. Using an attorney to help prepare your annual reports is a smart, executive decision that will benefit the company and the shareholders every year.