What Is a Statement of Information?

Trying to make sense of the vast array of reports and forms in compliance can be dizzying for any business leader. As your organization grows and evolves, staying informed about these forms helps you scale sustainably, especially when you want to operate in multiple states or plan to expand.

One vital report that comes up frequently in the state of California is the statement of information, or California’s annual report. In this guide, we’ll dig deeper into what a statement of information means for your company and why it’s important.

What Is the California Statement of Information?

The statement of information in California provides a snapshot of your company’s activities over the past year. Think of it like a peek into your company’s heartbeat, showing what’s going on with its operations, budget, and overall well-being.

This document is more than just a regular report — it contains key information that could be important for shareholders and others who care about your company. Shareholders use this statement to check how well the management is doing and where the company is headed.

The filing frequency of this statement is usually annual. If your company is listed on a stock exchange, the expectations around these reports differ. Being publicly traded often requires more frequent filing, sometimes even on a quarterly basis.

What Do You Need on a Statement of Information?

When it comes to California’s statement of information, it’s important to have an understanding of the requirements.

Let’s break down the typical contents of this report.

Registered Agent Details

For limited liability companies operating in states that mandate a registered agent, it’s vital to include their details in the statement of information, including a physical address where your registered agent will be able to be reached. If there’s been a change in your registered agent, you must update the next statement with the new agent’s information promptly.

Accounting Policies

This section delves into the company’s financial practices and standards. It sets the framework for understanding how the company manages and reports its finances.

Balance Sheets

A snapshot of the company’s financial health, balance sheets outline assets, liabilities, and shareholders’ equity at a specific point in time.

Cash Flow Statements

Highlighting how much money goes in and out of your company, this section shows the company’s liquidity and overall financial performance.

Profit and Loss Accounts

A crucial component, the profit and loss accounts depict the company’s revenues, costs, and expenses over a period (most often a year), providing a clear picture of its financial performance.

Director’s Report

A narrative from the directors, this report offers insights into the company’s operations, performance, and future outlook.

Overview of Operations and Finances

A summary that encapsulates key highlights and significant financial activities over the specified period.

Auditor’s Report

An independent assessment, the auditor’s report gives an opinion on the veracity and accuracy of the company’s financial statements.

Names of Key Personnel

This section lists the names of the company’s managers, directors, and members, providing a clear view of the individuals steering the organization.

Typically, companies are expected to file the statement of information either annually or every two years, and there’s usually an associated filing fee.

Why Is It Important To File the Statement of Information on Time?

Compliance is two-fold. It’s about sticking to the rules, but it’s also about maintaining a good name for your company and staying on the right side of the law. Filing essential documents like the statement of information on time is a critical facet of compliance.

Let’s take a closer look at why timely filing is non-negotiable:

Penalty fees and notices: Being late can be costly. Delayed filing often incurs penalty fees. Additionally, your company might receive a notice of delinquency as a formal reminder of the oversight.
Suspension of business operations: Failing to file on time can even lead to the suspension of your business operations. Such suspensions are not just operational hiccups — they disrupt your business rhythm, impact employee morale, and erode trust among stakeholders.
Loss of entity name rights: A severe consequence of delayed filing is the potential loss of the right to use your legal entity’s name. This can negatively affect branding, contracts, and overall business identity.

Even if your business is in its nascent stages or you’ve yet to finalize key organizational decisions like appointing members, officers, or directors, you must still file a statement of information.

Keep in mind that you can always update the statement in subsequent years to rectify or add details. Staying compliant from the outset ensures your company remains in good standing and fosters trust with clients, partners, and regulators.

Filing on time also helps your company start the year on the right foot as you take stock of your current status and set goals for the coming year. Following your state’s filing rules gives you more time and less stress, which will help you focus on the important stuff like running and growing your business.

When Is the Best Time To File a Statement of Information?

Compliance can get overwhelming quickly, especially when the regulations differ based on the type of business entity. Let’s explore the filing requirements for corporations and LLCs in California.

Corporations in California take these steps:

Initial filing: After foreign qualifying in California, corporations need to file an initial Statement of Information using Form SI-550 within 90 days of their foreign qualification approval.
Annual filing: Following the initial filing, corporations must continue to file the Statement of Information every year. This should be done during a specific six-month filing window determined by the corporation’s original registration date.
Changes since last filing: If there have been any changes since the previous filing, corporations should submit another Form SI-550 to update their records.

If you’re an LLC in California, you follow these steps:

Initial filing: LLCs must file their initial statement of information using Form LLC-12 within 90 days of foreign qualifying.
Biennial filing: After the initial submission, LLCs are required to file the statement of information every two years. Similar to corporations, this submission should take place within a designated six-month window, determined by the LLC’s original registration date.
Changes since last filing: For any submissions following the initial filing, LLCs should use Form LLC-12 if there have been any updates since the last statement. However, if no changes have been made and the Statement of Information is due, the LLC should then file a Statement of Information–No Change (Form LLC-12NC).

Understanding the specifics of when and how to file your statement of information is crucial to ensure seamless compliance. Mosey can help you streamline your compliance needs, manage registration deadlines, and automate the filing process to keep all of the necessary information in one place for your convenience.

How Much Does It Cost To File the CA Statement of Information?

The financial aspect of compliance is a significant consideration for businesses, as understanding the associated costs of various filings is a key to effective financial planning. The statement of information is no exception.

The total cost of filing a statement of information and obtaining copies, if needed, will be contingent on the state’s regulations and fee structures. Here’s what you should know about its associated costs:

Filing Fees

The primary cost associated with the statement of information is the filing fee. Both LLCs and corporations will encounter these charges.

Copying Fees

In some instances, you might want to obtain a copy of a filed statement of information, either for internal records or other business processes. When requesting these copies, you’re likely to encounter copying fees.

Certification Fees

If you need a certified copy of the statement of information, there will be an additional certification fee.

It’s essential to consult with the California state agency or department to get precise fee details or use tools like Mosey that can provide you with updated filing information to help streamline the process.

Stay Compliant After Filing Statement of Information With Mosey

The complexities of compliance don’t have to overwhelm you. Filing a statement of information every year is an important step to running a business transparently and working with your business partners toward success.

With Mosey, you can ensure your business remains compliant and up-to-date. Streamline your processes, receive timely updates, and focus on what you do best — running your business. Sign up with Mosey today to get started.