What Records Should a Family Keep for Each Investment and Capital Commitment?

Keep a record set for each investment and capital commitment, from initial review through final disposition. Records show what the family agreed to, who approved it, how much was funded, and how the investment performed. They can answer later questions without relying on memory or searching scattered email threads.

Document the Decision and Terms

Include the investment proposal, diligence materials, risk review, conflicts disclosures, committee materials, approval record, and reasons for the decision. Retain executed subscription documents, partnership or shareholder agreements, side letters, and amendments. For a co-investment or syndicate, preserve the agreement describing rights, responsibilities, fees, information access, and how decisions are communicated.

Record the commitment amount, funding instructions, dates, and conditions to be met. Keep each capital call notice, proof of payment, distribution notice, and receipt confirmation. The capital call and liquidity planner can connect expected funding needs to the family's cash plan. Keep actual notices and transactions in the document file.

Keep Ongoing Reporting and Correspondence

Save financial statements, valuation materials, manager updates, tax documents, and material communications with the sponsor or company. Note changes to the business, investment terms, valuation assumptions, and expected timing. When the family makes a follow-on commitment, declines an available allocation, or approves a waiver, keep the supporting decision and related correspondence in the same file.

Use a naming convention and index that identifies the owner, entity, investment, document type, and date. The family may need a consolidated view across entities, while each record should identify which trust or company owns the interest. The page on coordinating decisions across trusts and generations explains why ownership needs to be clear. For private investments, compare reported results using a direct deal IRR and MOIC calculator, retaining the underlying cash flow data used in the calculation.

Secure Records and Control Access

Store records in a secure system with backups and access based on each person's responsibilities. The Single Family Office discusses limiting access to full records and ensuring staff know how records are kept. Set a process for adding and removing users, preserving older versions, and recording who changed or approved a document.

Keep records of governance rules that affect investments, including delegated authority and approval thresholds. Also keep conflict procedures. Review retention and disclosure requirements with your attorney and CPA, since obligations can depend on the structure, jurisdiction, and investment type. The operational process plan can help assign responsibility for maintaining files and follow-up.

it is important that everyone in your family office knows how records are kept and who has access to them.

Sources: Centimillionaire Strategies, The Single Family Office. Informational only, not financial, legal or tax advice.