As a business owner, you are probably aware of the numerous legal and administrative responsibilities that come with managing a Limited Liability Company (LLC). Conducting meetings and recording resolutions is one of these criteria. But what really is an LLC resolution, and why is it necessary?
A resolution is a written declaration that outlines a choice taken by the organization’s administrators or members. Resolutions can be used in an LLC to make significant choices including choosing new managers, signing contracts, or altering the operating agreement. Resolutions also serve as a record of the organization’s choices and support its legal position.
LLCs are required to maintain a company record book to record these choices. This book contains significant documents including the operating agreement, meeting minutes, and resolutions and serves as evidence of the company’s actions and choices. Maintaining the company’s legal status and safeguarding its liability shield depend on keeping correct records.
A meeting of an LLC is a gathering of the management or members of the firm to address business issues and make significant decisions. Members or management may elect new officers, ratify contracts, go through financial reports, and other things at an LLC meeting. All decisions reached at these sessions must be recorded in writing minutes or resolutions.
Similar to how a S Corp must record its yearly meetings in writing minutes. Annual meeting minutes serve as a record of the annual meeting of the firm and should contain information on the meeting’s date, time, and place, attendees, and an overview of the talks and decisions that were taken.
In conclusion, resolutions are an essential component of managing an LLC and aid in making sure the business complies with legal requirements. LLCs can safeguard their legal status and stay out of sticky situations by making decisions in writing and keeping thorough records. Consult with a lawyer or other legal expert if you’re unsure how to properly record your LLC’s decisions.