operational records
Definition
Operational records are the everyday business documents that show how your company actually functions, such as invoices, receipts, employee timesheets, inventory logs, and customer contracts. Courts and regulators treat these documents as evidence of your real business activity, which is why keeping them organized and accurate matters so much. They are different from financial statements because they capture the raw details of transactions rather than the summarized picture.
Example
If a customer sues you claiming you never delivered the goods they paid for, your shipping logs, delivery confirmations, and signed receipts are the operational records that prove you held up your end of the deal.
Watch Out
Many small business owners delete or toss these documents too soon, but most states and federal agencies require you to keep certain operational records for three to seven years depending on the type.
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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.