books and records
Definition
Books and records refers to all the financial and business documents your company keeps, including bank statements, invoices, receipts, contracts, tax filings, payroll records, and meeting minutes. The law requires businesses to maintain accurate and organized records so the government, investors, or courts can verify how the business has been operating and handling money.
Example
If the IRS audits your bakery, they will ask to see your books and records to confirm that the income you reported on your tax return matches your actual sales and expenses.
Watch Out
Most states require businesses to keep their books and records for a minimum number of years, and destroying them too early can result in serious legal penalties.
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This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.