Heading into 2020, the last thing most of us expected was a worldwide pandemic. Now that we are in the midst of one, business, as usual, can seem far away. There are, however, things that can be done to counter the uncertainty and mitigate the disruption.
Ensuring compliance efforts are uninterrupted for your company or firm and clients during this crisis is crucial for long-run stability and success going forward. The paragraphs below discuss some steps any firm or business can take in this direction.
Forming A Statutory Company
Companies owned by a statutory entity such as an LLC, corporation and even a nonprofit are generally in a better position to obtain the grants, loans, and funding they may need to survive in a downturn economy than are companies owned by individuals. There is the added benefit that the entity, instead of the individual, is liable for the company’s debts. Forming a corporation or LLC prevents the individual from being liable for contract and debt fulfilments and keeps the stake owner in a safer legal position.
Compliance Issues
A Certificate of Good Standing also called a “Certificate of Existence” is a state-issued document that shows that your corporation, limited liability company, or any other entity has met its statutory requirements and is authorized to do business in that state. It is also necessary to file your annual reports and pay franchise taxes to the state in a timely manner. The experts at Blumberg have the knowledge and relationship with the secretary of state offices to keep companies compliant eliminating unnecessary worry so that businesses can spend time on operational and strategic matters in a challenging environment.
LLC and Corporate Manager a Protocol with Forms for Maintenance of Entity Record Books. Click here to learn more.
There are also internal compliance requirements that businesses are required to adhere to. Companies should make sure to keep their books and records up to date. Corporations should keep annual minutes and make sure they have adopted bylaws. While the requirements of Limited Liability Companies are somewhat less formal and burdensome than those of corporations, they must adopt operating agreements and maintain an objective record of important transactions, hirings, and acquisitions each year. In addition, all entities must, of course, make sure that they adhere to all generally accepted business, regulatory, and accounting practices.
Changes to the Business Charter
Certain business decisions may take effect during a crisis, forcing an entity to change its principal office address, change its name, use an assumed name, or qualify to do business in another state. A company like Blumberg can ensure that these types of fillings are recorded with the state or respective authorities as required by jurisdictional statutes so that the entity can remain compliant in its business operations.
Certain business decisions may take effect during a crisis, forcing an entity to change its principal office address, change its name, use an assumed name, or qualify to do business in another state. A company like Blumberg can ensure that these types of fillings are recorded with the state or respective authorities as required by jurisdictional statutes so that the entity can remain compliant in its business operations.
The same applies when changing the registered agent. A filing is required with state authorities in order to effect the change. Appointing a company that provides registered agent service ensures that legal proceedings are received and delivered to your company electronically in a timely manner, eliminating any anticipated delay by mail or courier. In fact, during a crisis, you are able to conduct business as usual with the ability to view your entity information and legal proceedings simply by signing on to a digital platform, that companies like Blumberg provide free of charge.
Human Resource issues
One of the most challenging issues that companies face during a crisis as all-encompassing and overwhelming as the one that currently exists is the management of a company’s staff. During an emergency, it may seem that the most prudent course of action involves addressing the immediate problem at hand – a sort of “triage” approach. This is not necessarily a bad thing but it must be accompanied by clear and rational management of the company’s employees. Otherwise, a company can run afoul of numerous human resource violations. Labor rules are not suspended in extraordinary times (at least not without government direction). In fact, this is the time that a clear, thoughtful, and legal course of action is necessary to avoid chaos and harm – both to the employees and to the company.
General Issues
All of the above practices are wise and prudent at any time. However, the massively disruptive circumstances of this pandemic have challenged the focus of many companies. It is very easy to forego the business and legal formalities during a crisis and focus instead on the immediate problems and issues that arise. However, to do so is to risk legal and accounting consequences – some immediate and some further down the road. It also risks physical and emotional harm to employees. In order to help ensure that a company survives and grows when a crisis like the current one has passed it is imperative to create a plan which anticipates such a crisis. Even though a particular crisis may not be foreseeable, a company that plans for the unexpected is more likely to be a company that survives the unexpected. And those plans include not only a course of action during extraordinary circumstances but meticulous adherence to basic formalities of everyday operations. Using a company like Blumberg to ensure compliance with the everyday operational requirements can save a great deal of time and effort and allow the company to focus on the immediate task of navigating a course of action through a crisis.
A last word. At this moment scientists and the medical profession are saying that Covid 19 may well return in the fall and winter. The compliance steps you take now will serve to make your response to any resurgence that much more effective.