Policy #11: Document Retention and Destruction

San Diego Theatres

Policy #11: Document Retention and Destruction

Page 1 of 14

SAN DIEGO THEATRES, INC.

CORPORATE POLICY

Subject:DOCUMENT RETENTION AND DESTRUCTION POLICY

Policy #:11

Date:February 4, 2013

Page:1 of 14

Article 1- General

This Document Retention and Destruction Policy (the “Policy”) of San Diego Theatres, Inc., a California nonprofit public benefit corporation (“SDT”) identifies the record retention responsibilities of staff, volunteers, members of the Board of Directors of the SDT (the “Board”), and outsiders for maintaining and documenting the storage and destruction of SDT’s documents and records.

Article 2- Rules

SDT’s employees, officers, volunteers, members of the Board and outsiders (e.g., independent contractors or vendors) are required to honor the following rules: (a)paper or electronic documents indicated under the terms for retention in Article 3 below and Exhibit A hereto will be transferred and maintained by the Human Resources, Legal or Administrative Department or their equivalents; (b)all other paper documents will be destroyed after five years from the date on which each such document is no longer of use to SDT; and (c)all other electronic documents will be deleted from all individual computers, databases, networks, and back-up storage after three years from the date on which each such document is no longer of use to SDT. Notwithstanding the foregoing, no paper or electronic documents will be destroyed or deleted if pertinent to any ongoing or anticipated government investigation or proceeding or private litigation. Information pertaining to unauthorized destruction, removal, or use of organization records, or regarding or falsifying or inappropriately altering information in a record or document should be reported directly to the Compliance Officer in accordance with the Whistleblower Policy.

Article 3- Miscellaneous

1. Exception. Exceptions to these rules and terms for retention may be granted only by the written authorization and direction of SDT’s President & Chief Executive Officer (the “CEO”).
2. Electronic Files. Electronic files are considered the same as a paper file. If a document only exists electronically, it should be retained for the same retention period. Electronic media containing electronic files should be clearly identified and where appropriate, aggregated in individual network folders by destruction date.
3. Amendments; Waiver. A new Policy may be adopted, or any provision of this Policy amended, waived or repealed, by the approval of at least a majority of the disinterested members of the Board, provided a quorum is present.

Article 4- Custodian of Records; Responsibilities

1. Custodian of Records. The chief financial/accounting manager is SDT’s custodian of records (the “Custodian”).
2. Responsibilities of Custodian of Records. The Custodian is responsible for the following:

(a)Implementing this Policy;

(b)Maintaining documents relating to the development of this Policy;

(c)Handling requests for changes in retention periods or exceptions from specified retention periods;

(d)Educating the employees of SDT with respect to this Policy and periodically auditing compliance with the Policy;

(e)Suspending the destruction of all potentially relevant documents, in consultation with legal counsel, upon receiving notice of the reasonable likelihood of, or pending or actual, litigation or governmental investigation;

(f)Monitoring, in consultation with legal counsel, compliance with the suspension of the destruction of all potentially relevant documents, including periodically reissuing notice and reminding people likely to have relevant information to preserve it under the litigation or investigative hold; and

(g)Securing updates to this Policy to reflect changes in the law.

Article 5- Guiding Principles.

1. Compliance with Governmental Requirements. All document retention practices should adhere to the applicable legal requirements. If any of our document retention procedures violates the legal requirements, we should always adhere to the applicable legal requirements and an employee that is aware of the noncompliance should advise the Custodian of the applicable legal requirement and the departure from our Policy.
2. Threatened, Pending or Actual Litigation and Governmental Investigations.

(a)The Custodian must be informed of the occurrence of any incident that may reasonably be expected to give rise to litigation or governmental investigation, or the receipt of a complaint, demand letter, notice of investigation, or other similar notice as soon as the situation arises.

(b)When the Custodian receives notice of threatened, pending or actual litigation or governmental investigation or any incidents or situations which may give rise to litigation or a governmental investigation, the Custodian, in consultation with legal counsel, will issue a “litigation hold” ordering all employees to halt the destruction of all potentially relevant documents, including email and voicemail, and to actively preserve such documents. Alteration and concealment of documents is prohibited. The Custodian, in consultation with legal counsel, will ensure that the litigation hold is communicated to all employees, and shall communicate the litigation hold directly to key people who are likely to possess relevant documents or information, and those involved with the events giving rise to the threatened, pending or actual litigation or governmental investigation.

The Custodian, in consultation with legal counsel, will supervise SDT’s retention of potentially relevant documents and compliance with the litigation hold. In cases of doubt about whether a document should be retained, the presumption will be in favor of retention. Documents that have been determined, in good faith, not to be potentially relevant may be discarded in accordance with this Policy. The Custodian, upon consultation with legal counsel, will notify employees when suspension of the destruction of documents is over.

1. Appropriate Discarding of Confidential or Highly Sensitive Information.

(i)Provided that document destruction is otherwise proper under this Policy, documents that are confidential or highly sensitive should be shredded or otherwise safely and completely destroyed.

(ii)For electronic files, appropriate techniques (such as “absolute delete”) should be used to make sure that all copies of the documents are deleted from the medium or archives in which they previously resided.

Article 6- Procedures

1. Information Retained on Voicemail

(a)As a general matter, voicemails should not be retained longer than thirty (30) days. Any information contained in voicemail that is useful or necessary to the conduct of SDT’s business should be converted to an electronic or hard copy memorandum and filed in the appropriate file.

1. Drafts

(a)Drafts of press releases, and other documents should be discarded at such time as the press release is issued, or the document is filed. Drafts of contracts should be maintained in a separate file labeled “Drafts” for the same retention period as the executed contract.

1. Electronic Mail

(a)Employees are discouraged from archiving emails, except as required by business necessity. Emails that must be retained pursuant to this Policy shall be either printed in hard copy and kept in the appropriate file, or downloaded to a computer file and kept electronically or on disk as a separate file.

(b)SDT has the right to read, copy or erase email messages transmitted or received on SDT’s equipment or through SDT’s networks, and may do so where SDT deems it appropriate. Employees are notified of SDT’s rights at the time of hiring, and employees should not have any expectation of privacy in their email messages transmitted or received on SDT’s equipment or through SDT’s networks.

(c)Email should not be used to transmit third-party materials, particularly as attachments to email messages, without the prior authorization of those third parties. Articles, pictures, diagrams, and other similar forms of expression are generally the copyrighted material of a third party.

Article 7– Terms for Retention

Attached as Exhibit A is a list of SDT’s required document retention periods. While the record retention periods are based, in part, on federal and California law, and SDT’s needs, in no case should records be destroyed before the recommended retention period or before federal or California law requires. The retention periods exclude the year in which the records were originated.

Exhibit A

I. / General Corporate Records
II. / Tax Records
III. / Accounting and Finance Records
IV. / Personnel Records
V. / Payroll Records
VI. / Employee Benefit Plan Records
VII. / General Contracts and Correspondence
VIII. / Insurance Records
IX. / Property Records
X. / Intellectual Property Records
XI. / Internet Records
XII. / Donations/Funder Records
XIII / Event Records

Abbreviations:

Act:While active/employed

P:Permanent

Specific Documents / Retention Time
I.General Corporate Records
General Principle – The Corporate Secretary is responsible for establishing policies for all documents handled by the Corporate Secretary.
A.Articles of Incorporation, bylaws, and amendments thereto; any other organizational document / P
B.Board books and PowerPoint presentations / P
C.Minutes of meetings of the board of directors and the committees of the board of directors / P
D.Board resolutions / P
E.Corporate policies and procedures, and policy statements / P
F.Annual reports / P
G.Record of SDT’s members, including members’ names, addresses, class of membership held by each. / P
H.SDT charts / Act
I.Financing documents, credit agreements, loan agreements, commitments, etc. / P
J.Drafts of documents listed in I (A) through (F) should NOT be retained / N/A
II.Tax Records
General Principle – The Chief Financial Officer is responsible for establishing policies relating to tax records which include documents concerning payroll, expenses, proof of deductions, business costs, accounting procedures, and other documents concerning SDT’s revenues.
A.Application for recognition of tax-exempt status / P
B. Tax exemption determination letter and related correspondence / P
C.Tax returns (federal and state) / P
D.Files related to tax audits / P
E.Filing of fees paid to professionals / 7 years
F.Items of income, loss, deduction or credit / 7 years from the date the return is filed for the period in which the item is incurred
G. Items of basis, depreciation, amount realized, or gain or loss on disposition of an asset / Period of time asset is held, plus 7 years from the date the return is filed for the period in which the asset is disposed of
H.Income tax withholding / 7 yearsafter tax is due or paid, whichever is later
I.Social security contributions: Copies of any tax return, schedule or other document relating to the tax. Records of all remuneration (cash or otherwise) paid to employees for employment services / 7 years
after tax is due or paid, whichever is later
J.W-2 statements / 7 years
III.Accounting and Finance Records
General Principle – The Chief Financial Officer is responsible for establishing policies for all documents related to SDT’s accounting and other financial records.
A.All ledgers and journals / 7 years
B.All balance sheets and other financial statements / P
C.Trial balance sheets or equivalent records / 7 years
D.Estimates, projections, planning, memos, etc. / 7 years
E.Banking records, including deposit and withdrawal records, bank statements / 7 years
F.Checking account records, including account statements, check register and canceled checks / 7 years
G.Credit card receipts / 7 years
H.Expense accounts, approvals, petty cash records, commission records / 7 years
I.Records of all accounts receivable, indices to accounts receivable, and summaries of such accounts / 7 years after receipt of final payment
J.Accounting department copies of invoices issued and supporting papers which do not accompany the original invoices and authorizations for charges including supporting papers / 7 years after receipt of final payment
K.Summaries of periodic statements of cash balances on hand and with depositories for SDT or any subsidiary / Act
L.Requisitions and receipts for funds / Act after funds have been returned or accounted for
M.Chart of accounts / P
N.Depreciation schedules / P
O.Attorney contingent liability letters / Permanent
P.Investment records (deposits, earnings, withdrawals) / 7 years
IV.Personnel Records
General Principle – The Compliance Officer is responsible for establishing policies relating to personnel records.
A.Age of employees: Payroll or other records containing name, address, date of birth, occupation, rate of pay, compensation earned per week / 3 years from the date of employee’s termination of employment
B.Applicant records: Application forms, applicant flow data, interview notes and memoranda, job postings (including advertisements), resumes, records related to pre-employment testing / 2 years from the date of leave or date of creation, whichever is later
C.Discrimination charges, or complaints of discrimination from state or federal agency, internal complaint of violation of state or federal law, investigation file, correspondence to/from complainant, correspondence to/from appropriate state/federal agency / 1 year from the date the charge or complaint is resolved
D.Form W-4 / Act + 4 years
E.Immigration records: Form I-9 for every employee and former employee. Copies of supporting documentation, if maintained / 3 years or 1 year after termination of employment, whichever is later
F.Personnel files:

• job applications and resumes
• payroll authorization form
• employment agreement (if any)
• acknowledgement of receipt of employment policies
• compensation, dates of hire, seniority, birth, and other change of status
• notice of commendation, warning, discipline or termination, notices of layoff, leave of absence, and similar matters
• performance appraisal/interview evaluation ratings
• attendance and absence record
• employee requests for job reassignment or accommodation
• all records relating to hiring, assignment, promotion, demotion, transfer, layoff, termination, testing and/or training

/ Later of 2 years after creation of file or termination of employment
G.Unemployment insurance:

• Unemployment insurance claims, unemployment insurance contributions, Federal unemployment tax records; for each contribution:

• pay period; name, social security number, date of hire or rehire and place of work of each employee; remuneration paid to each worker, showing separately money paid, cash value of other remuneration, and special payments in cash or in kind for services other than those rendered exclusively in a given pay period, such as annual bonuses, gifts, and the like; disbursement records that show payments to anyone who performed services for the employer; any other information necessary to enable the employer to determine an employee’s total remuneration in each week

/ 4 years after the due date for contributions or the date the contributions are paid, whichever is later
H.Workers’ compensation:

• Employer’s date-stamped copy of Employee’s Claim for Workers’ Compensation Benefits (DWC Form 1)
• Every report made to the Administrative Director of the Division of Workers’ Compensation, including DWC Form 500
• Letter of denial to employee (if any)
• Every medical report pertaining to the claim
• All applicable orders and/or awards of the Workers’ Compensation Appeals Board
• A record of payment of compensation benefits
• Any estimate of future liability
• A copy of the application(s) for adjudication of claim filed with the Workers’ Compensation Appeals Board (if any)
• Copies of all notices sent to the employee

/ 5 years, from date of injury or last benefit payment
I.Wage and hour:
Non-Exempt Employees: name, social security number or ID number/symbol, home address (including ZIP Code), birth date (if minor), sex, occupation, workweek start time, hourly rate, pay basis, regular rate exclusions, hours worked by date, hours per workweek, straight-time earnings, overtime premium pay, gross wages, net wages, deductions from pay, additions to pay, date of payment, pay period dates
Exempt Employees: name, ID number or symbol, home address (including ZIP code), birth date (if minor), sex, occupation, workweek start time, pay basis, gross wages, net wages, fringe benefits
Other Documents: all documents relevant to wages including: collective bargaining agreements, plans, trusts, employment contracts, memoranda of oral agreements, etc., total dollar volume of sales, total dollar volume of goods purchased/received / 3 years from the date the document is created or employee’s last date of employment, whichever is later
V.Payroll Records
General Principle – The Chief Financial Officer is responsible for establishing policies for all documents relating to payroll.
A.Payroll registers documenting payments of salaries and wages, pensions, and annuities paid by SDT or by contractors on its account / P
B.Records showing the distribution of salaries and wages paid for each payroll period and any summaries thereof / 6 years
C.Time tickets, timesheets, timecards, workmen’s reports, and other records showing hours worked, description of work, and accounts to be charged / Act (provided that the basic information contained thereon is transferred to work orders or other records)
D.Paid checks, receipts for wages paid in cash, and other evidences of payment / 3 years
E.Authorizations for changes in wage and salary rates, summaries, and reports of changes in payrolls and similar records / 6 years
F.Payroll authorizations, records of authorized positions, and terminations / 6 years
G.Comparative or analytical statements of payroll / 6 years
VI.Employee Benefit Plan Records
General Principle – The Compliance Officer is responsible for establishing policies for all employee benefit plan documents and supporting employee data to ensure that SDT can establish at all times whether or not a benefit is payable to an employee, or former employee, and, if so, the amount of such benefit.
A.Plan documents and all amendments thereto / P
B.Records of employee service and eligibility for benefits (including hours worked and any breaks in service) / P
C.Required personal information on employees and former employees (name, address, social security number, period of employment, pay: hourly or salary) / P
D.Records of plan administrator setting forth authority to pay / P
E.Records of benefits paid to employees or their beneficiaries / Until after the death of payee
F.Plan documents and supporting documentation (such as actuarial calculations) filed with the Internal Revenue Service, Department of Labor, and Pension Benefit Guaranty Corporation / 6 years
G.Certificates of creditable coverage (available to health benefit plan participants and dependents upon request) / 2 years after coverage ceases
H.Records identifying former employees entitled to coverage under COBRA (Consolidated Omnibus Budget Reconciliation Act of 1985) and records relating to former employees electing such coverage / 6 years
VII.General Contracts and Correspondence
General Principle – The Compliance Officer is responsible for establishing policies relating to all contracts and other corporate records that do not fall into any other category specifically described in this Exhibit.
A.Commercial agreements, collaborative agreements, research and development agreements, financial agreements, and advertising agreements / 10 years after termination of rights under agreement
B.Drafts of agreements (but not other general corporate records) should be maintained in a separate file labeled “Drafts” / Same period as the executed contract is maintained
C.Correspondence
1.Letters requiring no follow-up, copies of interdepartmental or other SDT correspondence / 90 days
2.Letters requesting specific action such as name or address change, complaints where changes are made or action taken, letters of general inquiry and replies which complete a cycle of correspondence and are of no further use / 1 year
3.Routine letters with customers and vendors, letters explaining but not establishing SDT policy, quotation letters where no contract results, letters to which a customer might make reference in the future / 5 years
4.Letters pertaining to bills of sale, permits, etc., letters which constitute all or a part of a contract or which are important in the clarification of certain points in a contract, letters denying liability of SDT, letters which SDT might need to produce in court to disprove liability or to enforce rights / Indefinitely or for life of documents it supports
VIII.Insurance Records
General Principle – The Chief Financial Officer is responsible for establishing policies relating to insurance records.
A.Insurance policies and records / P
B.Accident reports/insurance claims / 7 years
C.Records of amounts recovered from insurance companies in connection with losses and records of claims against insurance companies including reports of losses and supporting papers / 6 years after settlement
IX.Property Records
General Principle – The Chief Financial Officer is responsible for establishing policies relating to all property records.
A.Building maintenance and repair records / 10 years
B.Machinery maintenance and repair records / 5 years
C.Property deeds, easements, licenses, rights of way / P
D.Purchase or lease records / P
E.Mortgages / P
F.Appraisals / 1 year
G.Equipment inventory / Act
H.Motor vehicle records / Act + 1 year
I.Vendor, hotel and service agreements (expired) / 7 years
X.Intellectual Property
General Principle – The Compliance Officer is responsible for establishing policies relating to intellectual property.
A.Trademarks, copyrights, and associated applications / P
B.Licensing Agreements / 10 years after termination of rights under agreement
C.Letters and applications pertaining to copyrights, trademarks, licensing agreements / Indefinitely or life of documents it supports
XI.Internet Records
General Principle – The Compliance Officer is responsible for establishing policies relating to SDT’s website records.
A.Webpages, online ads and any other record located on SDT’s website / [varies[1]]
XII. Donations/Funder Records
General Principle – The Chief Financial Officer is responsible for establishing policies relating to donations/funder records, which include documents concerning donor identification, receipts, information that must be provided to donors at the time of solicitation, and other documents concerning SDT’s donations/fundraising.
A.Grant dispersal contract / P
B.Donor lists / 7 years
C.Grant applications / 7 years
D.Donor acknowledgements / 7 years
XIII Event Records
General Principle – The Compliance Officer is responsible for implementing and monitoring established policies related to Event Records, which include license agreements, settlements with supporting documentation, ancillary revenues, fees and expenses, attendance and activity reporting.
A. Event Records / 10 years
B. Summarized Historical Event Data / P
C. Records of Potentially Historic Value / P

As adopted by the San Diego Theatres, Inc. Board on February 4, 2013