SELLING PRIVATELY HELD BUSINESSES


–SINCE 1982–

Business Record Retention – How Long Should You Keep Records?

Provided by:  Brian Flynn, President

Flynn Accounting Resources, Inc.

Accident Reports / Claims (settled cases)7 Years
Accounts Payable Ledgers & Schedules7 Years
Accounts Receivable Ledgers & Schedules7 Years
Audit ReportsPermanent
Bank Reconciliations2 Years
Bank Statements3 Years
Capital Stock & Bond Records

Ledgers, Transfer Registers, Stubs showing issues,

Record of Interest Coupons, Options, etc.

 

 

Permanent

Cash BooksPermanent
Charts of AccountsPermanent
Checks (canceled – see exception below)7 Years
Checks (canceled) for important payments (i.e. Taxes, Purchases of Property, Special Contracts, etc.) ***Checks should be filed with the papers pertaining to the underlying transaction. 

 

Permanent

Contracts, Mortgages, Notes & Leases (expired)7 Years
Contracts, Mortgages, Notes & Leases (still in effect)Permanent
Correspondence (general)2 Years
Correspondence (legal & important matters only)Permanent
Correspondence (routine – with customers and/or vendors)2 Years
Deeds, Mortgages & Bills of SalePermanent
Depreciation SchedulesPermanent
Duplicate Deposit Slips2 Years
Employment Applications3 Years
Expense Analyses / Expense Distribution Schedules7 Years
Financial Statements (year end, other optional)Permanent
Garnishments7 Years
Insurance Policies (expired)Permanent
Insurance Records (current accident reports, claims, policies, etc.)Permanent
Internal Audit Reports (longer retention periods may be desirable)3 Years
Inventories of Products, Materials & Supplies7 Years
Invoices (to customers, from vendors)7 Years
JournalsPermanent
Magnetic Tape & Tab Cards1 Year
Minute Books of Directors, Stockholders, Bylaws, & CharterPermanent
Notes Receivable Ledgers & Schedules7 Years
Option Records (expired)7 Years
Patents & Related PapersPermanent
Payroll Records & Summaries7 Years
Personnel Files (terminated)7 Years
Petty Cash Vouchers3 Years
Physical Inventory Tags3 Years
Plant Cost Ledgers7 Years
Property Appraisals (by outside appraisers)Permanent
Property Records (including costs, depreciation reserves, year end trial balances, depreciation schedules, blueprints & plans) 

Permanent

Purchase Orders (except purchasing department copy)1 Year
Purchase Orders (purchasing department copy)7 Years
Receiving Sheets1 Year
Retirement & Pension RecordsPermanent
Requisitions1 Year
Sales Commission Reports3 Years
Sales Records7 Years
Scrap & Salvage Records (inventory sales, etc.)7 Years
Stenographers Notebooks1 Year
Stock & Bond Certificates (canceled)7 Years
Stockroom Withdrawal Forms1 Year
Subsidiary Ledgers7 Years
Tax Returns (worksheets, revenue agents reports & other documents relating to determination of income tax liability) 

7 Years

Time Books / Cards7 Years
Trademark Registration & CopyrightsPermanent
Training ManualsPermanent
Union AgreementsPermanent
Voucher Register & Schedules7 Years
Vouchers for Payments to Vendors, Employees, etc. (includes allowances & reimbursements of employees, officers, etc., for travel & entertainment expense) 

7 Years

Withholding Tax Statements7 Years

 

(originally published in November 2012 eNewsletter)

Flynn Accounting Resources, Inc., is located in Colorado Springs and provides financial statement compilation, business consultation, tax planning and preparation and payroll services to a wide range of clients in a variety of industries.  You may contact Brian Flynn at  brian@flynnaccounting.com.