From time to time our office receives questions from clients similar to the following two (recent) inquiries:
Do you have a record of what Dr. ________ paid for his stock in our corporation back in the mid-1970s?
We have been asked by __________ to provide them with a copy of the form IRS issued assigning us our employer identification number when we incorporated in 1982. Where can we find this?
In situations in which we have represented the business since its inception, we generally have this type of information. However, in situations in which we were not involved at the inception often we do not have it, as was the case in both of the situations mentioned above.
Any business, no matter in what form it is operated, should establish a formal record retention policy. While some records may be discardable after a period of time, others – such as the two mentioned above – should be retained in perpetuity. In addition to establishing a written policy, businesses should review their records and files to determine whether they currently have all the information, files, or records that they may need in the future.
If it is determined that something is missing (e.g. stock cost basis information) then steps can be taken to try to track down the information. The sooner those steps are taken the more likely it is that the information can be uncovered. One thing is certain: a business will have more information now (or otherwise be able to assemble it now) than it will five years from now.