Internal Requirements refer to the actions, and supporting documentation that must be kept by the company. Directors and Shareholders are responsible for taking action in a Corporation (INC.); Members and Managers are responsible in Limited Liability Companies (LLC). Often, these Internal requirements are are neglected, and may have significant negative implications if not addressed.
External Requirements refers to the actions and documentation that is required by the State of California, including but not limited to document filings on either annual or other time intervals.
Failure to meet the deadlines of any of the many requirements may result in penalties. Failure to meet the state imposed requirements in other ways may also result in penalties.
If a corporation is accused of wrongdoing, often those accusing will attempt to 'Pierce the Corporate Veil'; such 'Corporate Veil' generally refers to a limitation of personal liability for those that operate a company in good faith and in compliance with all reporting, rules and regulations. An attempt to pierce the veil will always be accompanied by demand for, amongst other things, compliance documents.
While not the only evidence that is taken into consideration, Corporate Compliance is one of the most cost-effective and straightforward ways to help protect against these types of claim. Willbanks & Wood PLC can assist with preparation of your Corporate Documents to ensure that they meet the current State requirements.