Principal Issues:
(1) What is the meaning of the term summaries within Reg. 5800(1)(a)(iv)?
(2) What is the required retention period for the general ledger or other book of final entry?
(3) What is the required retention period for every account and voucher necessary to verify the information contained in the general ledger or other book of final entry?
(4) What constitutes a special contract or agreement for purposes of Reg. 5800(1)(a)(v)?
Position:
(1) Based on a textual, contextual, and purposive approach to interpreting the meaning of the word "summaries" in subparagraph 5800(a)(iv) of the Regulations, it is our view that the term summaries refers to the summary of all individual transactions posted from the journals to the general ledger.
(2) Question of fact. A corporation is required to retain the general ledger or other book of final entry for two years following the day of dissolution. The summaries of all individual transactions are generally posted to the general ledger. We are of the view that where individual transactions are posted to subsidiary ledger and not to the general ledger, such subsidiary ledger should generally fall within the ambit of subparagraph 5800(a)(iv) of the Regulations.
(3) Accounts and vouchers necessary to verify the information contained in the general ledger or other book of final entry are generally "non-permanent" records and therefore are to be retained for six years from the end of the last taxation year to which the records and books relate pursuant to paragraph 230(4)(b) of the Act.
(4) It is a question of fact whether a lease would be considered a special contract or agreement pursuant to subparagraph 5800(a)(v) of the Regulations.
Reasons: Wording of the Act and the Regulations.
