Following is a general guideline for how long records should be kept. The guideline does not cover all records or situations. Boards should work with legal counsel and a CPA to establish their own records retention policy.
A. Permanent
1. Governing Documents
-
CC&Rs
-
Bylaws
-
Articles of Incorporation
-
Condominium Plan
2. Minutes
3. Deeds to Property Owned by the Association
4. Architectural Plans
B. Seven Years. To ensure that all statutes of limitations have passed, the following records should be kept for seven years before disposing of them.
1. Financial Records
-
budgets
-
general ledgers, journals and charts of account
-
year-end financial statements
-
accounts payable
-
accounts receivable ledgers, trial
balances and billing records
-
canceled checks and bank statements
-
expense analysis and expense
distribution schedules
-
invoices from vendors
-
deposit slips
-
reconciliations
-
petty cash vouchers
-
purchase orders
2. Expired Contracts
3. Personnel Records (payroll records and employee records after termination)
4. Insurance Records
-
accident
reports
-
settled claims
-
expired policies
-
fidelity bonds
-
certificates of insurance
5. General Correspondence
6. Closed Litigation Files
7. Newsletters
8. Expired Warranties
9. Tax Returns
C. One Year. Ballots must be stored by associations in a secure place for no less than one year after the date of the election.
Civil Code §1363.03(i).
D. Secure Destruction. Whenever an association disposes of records,
it must ensure that the records are completely destroyed, preferably by shredding or incineration. Simply throwing them into the trash can result in potential liability if confidential records end up in the wrong hands.
E. Litigation Hold. Records should not be destroyed if the association has notice of or reasonably believes it will be involved in a lawsuit. If the association receives notice of a lawsuit, disposal of records should be put on hold until the litigation has been resolved.