CHAPTER 7: ACCOUNTING, RECORDS, AND ASSOCIATED REGULATIONS
Auditors will confirm that paper and digital documents are stored based on the appropriate government regulations. Records are mainly kept to meet legal guidelines but also to resolve discrepancies and for protection against lawsuits. Where digital storage systems are acceptable, they must not only securely maintain the information, but also provide the ability to retrieve and read the data, regardless of changes in technology. The integrity of electronic storage systems puts the onus on companies to prove their systems are accurate and reliable and have not been altered or tampered with. Cindy Clark, ARM, Client Delivery Manager for VSP, notes that because her company’s staff is almost completely remote-based, they’ve transitioned all their records retention to electronic storage. She explains, “Billing documents are available to use and our customers through online portals, although we do support clients who require receipt of paper billing documentation through centralized mail services functions. Documents received from customers are scanned upon receipt, worked and retained electronically. For the very rare situation where there is a requirement for a paper document with a wet signature or notarization, we have established a process between our mail room and finance support staff who manage the handling and return of the document.” Ideally, the records-management program should focus on managing the right information at the lowest cost and should be able to inform anyone regarding which records are stored, where they are stored, and how to retrieve them. Although there are specific guidelines that govern how long certain records must be retained, some companies simply keep records until there is no longer sufficient space to store them, forcing the management and staff to address the issue at a time when it has likely become overwhelming. For this reason, many organizations are increasingly turning to electronic storage methods. Another major issue that must be addressed is the large amount of unstructured data in the form of e-mail messages, documents, and presentations that exist on corporate file servers, employee desktops, and notebook computers. Unstructured data is typically unmanaged. An electronic records management system can and should be used to manage this data. Maintaining these records is costly, and implementing a solution that both meets the requirements and also protects the records from damage (i.e., water or fire) is a challenge. This is why many companies are investing in an electronic document management system. WHAT TO KEEP AND FOR HOW LONG Which records can be destroyed, which must be retained, and how do you go about storing them so that locating them is efficient and cost-effective?
While statutes of limitations on particular documents vary by country and should be verified, as a general rule correspondence needs to be kept for two years and invoices for a period of seven years.
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THE ACCOUNTS RECEIVABLE SPECIALIST CERTIFICATION PROGRAM E-TEXTBOOK
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