If Tomorrow Never Comes

MANAGEMENT

Attention small business owners: are your affairs in
order in case death takes you by surprise?

About 150,000 people around the world die every day;
of these, about 730 are Canadians. Even though death
is still inevitable, life expectancy for Canadians has
risen significantly in the last hundred years and continues
to rise. A male born in Canada in 1911, for example,
could expect to live for 47.1 years and a female
for 50.1 years. A male born a century later in 2012
can expect to reach 79.8 years of age and a female to
reach 83.9. This dramatic extension of life expectancy
is largely attributable to a sharp reduction in infant
and child mortality rates through medical intervention
(e.g., vaccinations), improved sanitation and a better
quality of life through the elimination of child labour,
improved education, and better diet.

Changing Statistics

In the years between 1979 and 2009, the percentage of
deaths due to diseases of the heart declined sharply to
22% from 35% for men (to 20% from 34% for women)
while the number of deaths attributable to malignant
neoplasms (i.e., malignant tumours that spread to other
parts of the body) rose to 31% from 22% for men (to
29% from 24% for women).

Unexpected Death

If death comes unexpectedly, are your business and
personal affairs in order so your business associates
and family can move forward with the minimum of
problems? As a test of your preparedness, ask yourself
the following questions. Your answers will indicate
what you need to do to be ready in case the unthinkable
happens. Discuss the results with the appropriate
individual and document as required.

• As a starting point, consider what information
  should be up to date.
• Who has signing authority on business and personal
  bank accounts?
• Who is your second to take over operations?
• Is key man insurance in place?
• Are financial statements current for valuation
  purposes?
• Have you established protocols and the format of
  notification of your death to clients and suppliers?
  (email? text?)
• Is there a (prewritten) letter to all clients and suppliers
  assuring them that the business is still viable
  and that named individuals will be looking after
  their accounts and business?
• Does the company have a corporate lawyer and a
  corporate accountant who should be notified?
• Is there a summary of all business and personal
  passwords to access bank accounts, tax accounts,
  computer programs, Cloud applications, hard drive
  backup, and client accounts?
• Are the minutes of the company kept up to date?
• Do the registers of directors and shareholders
  reflect current appointments?
• Is there a listing of all business and personal
  insurance policies, RRSPs, TFSAs and other such
  investment vehicles that must be accessed?
• Is there a listing of financing arrangements for
  business and personal vehicles, and your residence?
• Is there a listing of all credit cards and required
  passwords to determine balances owing?

Is your will up to date to reflect
changes in your personal life?

• Is your will up to date to reflect a divorce, marriage,
  acquired children or other dependants who
  may have created claims on your estate?
• Have you determined what, if anything, you wish
  to give to charities?
• Are survivors aware of who has the original will?
• Who is the executor(s) of the estate?
• Have insurance policies, RRSPs, TFSAs and the
  like been updated to ensure that the named beneficiary
  is correct?
• Have you reviewed personal and business debt to
  determine whether insurance coverage is adequate?
• Has a guardian for children or those with disabilities
  been named?
• Is access to safes and safety deposit boxes guaranteed
  with appropriate passwords, keys, and alarm
  codes?
• Have you considered meeting with funeral directors
  to discuss funeral arrangements (and payment)
  for a religious funeral service, cremation or
  burial to reduce the stress on survivors?
• Are family members aware that the Canada
  Pension Plan will pay a death benefit to the spouse
  and/or survivors in the event of your death?
• Have you considered a Statement of Wishes that
  outlines such issues as funeral arrangements,
  custody of children, and any other area that
  you would like to be in place upon your death?
  (Although not necessarily legally enforceable, it
  does provide guidance to survivors in times of
  stress.)
• And finally… have you made a list of the abovenamed
  items and provided those lists to the appropriate
  individuals who need to know how to act?

Act Now

We all put off what we should do today until tomorrow…
but what if tomorrow never comes?