How to Organize Orderly Business Record-Keeping Under the Civil Code

01

The rule in summary

Article 2214 of the Civil Code requires a commercial entrepreneur to keep the journal book and the inventory book, to prepare any other records required by the nature and size of the business, and to keep in orderly fashion, for each transaction, the originals of letters, telegrams and invoices received and the copies of those sent.

Article 2220 sets a ten-year retention period from the last entry for records, invoices, letters and telegrams, received or sent, even on image-based media provided they remain legible at all times.

02

Who it applies to and what it adds for companies

The duty of orderly record-keeping does not apply to small entrepreneurs, while it fully applies to those who carry out commercial activity in a more structured form.

Limited liability companies (S.r.l.) must also keep specific corporate books — the book of members' decisions, the book of directors' decisions, and the book of board of statutory auditors' decisions — whose documentation is kept by the company; in joint-stock companies (S.p.A.), by contrast, shareholder resolutions must be recorded in minutes indicating the date, participants and voting outcome.

03

The operational path step by step

Steps

1. Before use, number each page of the mandatory accounting books sequentially.
2. Record transactions in the journal book day by day, in chronological order.
3. Prepare the inventory at the start of the business and then every year, with assets and liabilities valued.
4. If you choose digital record-keeping, apply a time stamp and digital signature at least once a year.
5. Retain records, invoices, letters and telegrams for ten years from the last entry.

04

A hypothetical case

Hypothetical example: a commercial business closing its financial year in December prepares the inventory at the start of the year, records every invoice received in the journal book with sequential numbering and, if it opts for digital format, applies an annual time stamp before archiving the documents for the ten-year period set by Article 2220.

05

Checks before considering the archive in order

• Journal book and inventory book numbered sequentially before use.
• Originals and copies of letters, telegrams and invoices kept in order for each transaction.
• Digital records kept accessible at all times using available means.
• Shareholder meeting minutes with date, participants, capital represented and voting outcome.
• Ten-year retention period respected for each document category.

06

How management software can support document order

A business can ask its software partner to configure separate roles for those recording transactions, those archiving documents, and those checking compliance, so that every step from the original document to the accounting entry is traceable.

It is a useful operational choice to define a periodic review path that compares the annual inventory with the journal book entries, and to keep digital versions readable and accessible throughout the entire required retention period.

07

Common questions about record-keeping

• Sequential numbering applies to accounting books before they are put into use, under the rules on record-keeping.
• Digital record-keeping is allowed if entries remain accessible and are time-stamped at least once a year.
• The ten-year period runs from the date of the last entry, not from the date of the individual document.

08

Next step

Check with your advisor or management software which books and records apply to the size of your business and set an annual calendar for inventory, numbering and ten-year retention.