When the board of directors of an organization of the partner/shareholders of a company wants to make a decision or take some action and they are required by the local government laws to legalize that action by announcing it in public and creating a document of their decision, they sign this certificate of corporation resolution. With this document, they authorize a person or group of people to act on behalf of the organization.
Brief description of the Certificate of Corporate Resolution:
When a company or organization wants to make an important decision, all the shareholders or board of directors are legally obligated to sit together in a meeting and make the decision with the agreement of majority of the directors or shareholders. Once they have done that, they are also required to announce that decision and make it legal by creating the certificate of corporation resolution. For example, the board of directors of a company decides that they allow a particular employee to receive cash on behalf of the company. In this situation, they are required to create this certificate of corporation resolution and stating in the certificate that they are allowing that particular employee to receive cash payments on behalf of the company.
Essential elements to include in the Certificate of Corporate Resolution:
- Date when the certificate is being issued
- Name of the person/company or government department that the board of directors wants to notify about the corporate action
- Complete address of the addressee
- Explained subject of the certificate
- Name of the secretary who is writing and sending this letter
- Name of the organization
- Name of board of directors or shareholders who agreed to take the action in the meeting
- Details of that meeting i.e. (date when the meeting took place, location, duration and the number of people who voted in favor of the action and the number of people who didn’t agree)
- Details of the action/resolution decided by the board of directors
- Name of the people who are authorized by the corporate resolution (if applicable)
- Validation of the resolution
- Signature of the secretary in order to authorize the certificate
Importance and uses of the Certificate of Corporate Resolution:
This document can be used in many situations but most commonly, when banks are asked to open official accounts, they ask the applicant to disclose a document that states he is authorized to make payments and deal with finances on behalf of the organization so in that situation, that particular applicant will present this certificate of corporation resolution in front of the bank manager and will prove that he is in fact, authorized to deal with the cash flow of the organization by the shareholders or board of directors of that organization. In other cases, when companies send their employees or top managers to make deals with other companies and organizations, these managers are required to disclose this certificate in order to authenticate that they are allowed and permitted by the organization to make the deal.
Here is preview of a Free Fillable Certificate of Corporate Resolution in PDF Format,
Here is download link for this Certificate of Corporate Resolution,