What is a Statement of Information?
What comes after incorporating a business and after you have started running it too? Every company needs to be maintained and comply with the rules of the state government. And for this, it is important for the company to file the initial or annual report revealing the activities of the company over the last year with the state through the Statement of Information Form. These reports are compulsory in almost every state and would permit your company to remain compliant.
What Is a Statement of Information?
The Statement of Information Form is a form that is filed to reveal the activities of your company for the previous year. The information is highly crucial for the shareholders or any other third parties that have invested in your business and have interest in your company. The activities that are listed in the financial performance as well as on the Statement of Information Form would be utilized to determine how well the company is being operated and what are the company’s operations.
The filling of the Statement of Information Form has to be done on an annual basis, but the rules can vary from state to state. Moreover, the requirements of the lengthy statement reports are usually robust in case your business has been placed on a stock exchange. Moreover, you would also need to comply with the requirements of offering the Statement of Information Form more frequently such as the quarterly reports.
What Is Needed on a Statement of Information Form?
As mentioned above, each state has its own requirements and can vary from state to state. Nonetheless, the usually Statement of Information Form includes:
- Auditor’s report
- An overview of operations and finances
- Director’s report
- Profit and loss accounts
- Cash flow statements
- Balance sheets
- Accounting policies
Other than these, the Statement of Information Form would also need the names of the members, directors, and managers of the company. Moreover, in case your state just needs an initial report, the Statement of Information Form would be short in length. Basically, it would not include a few or even all of the points that were mentioned above.
Furthermore, the filing is normally needed on a biennial or annual basis, and you would have to pay the fee as well. But it is important to cross check with the state government agencies since the time for filing, and the fee varies from state to state.
Why Filing on Time Is Important?
In most states, it is mandatory to file the Statement of Information Form. Moreover, filing on time would make sure that your business stays compliant. And if it is your first year doing business, it is advised that you consult your state to figure out when you need to file the statement. Not filing on time can lead your company to face the following outcomes:
- A suspension of your company. You also wouldn’t have the rights to utilize your entity name anywhere after it.
- Penalty fees and a notice of delinquency.
All in all, if you plan to grow your company and keep it running for a long time, you need to maintain it in a good standing from which filing the Statement of Information Form is an important part.
It does not matter if the business has not determined the directors, officers, or members, you would still have to file the Statement of Information Form. Moreover, you can update the details in the next year and it would correct the information field of your initial report on your company.
In case your state needs a Registered Agent, you would have to include the information in the Statement of Information Form as well. Also, if you have changed the Registered Agent you had, you would have to file the new Statement of Information Form with all the updated details.
At the end of the day, it is better to start your day by complying with all the rules so that you can easily reach and taste success with the startup you put all your efforts in to. This would also allow you to run your business smoothly.
Disclaimer: The details shared above are general legal information and is not a legal advice. For more help on the entire thing, it is better to hire a professional lawyer and get help from them.