![]() Successful record-keeping for compliance and to monitor your business’s financial health should be a team effort. Many financial management software programs go beyond accounting and address record-keeping for financial health monitoring and compliance. If your shortcomings are related to the technology you’re using, do some research. Start with your low-tech functions: Do you need a better hard copy filing system or a central repository for all “essential” documents? Should you appoint a company records czar? Should some of your records be located off-site? If you are struggling to access necessary information or make deadlines, a system upgrade is in order. Was last tax time a nightmare to prepare for, or were you able to easily gather all the information you needed?Īre you meeting the due dates for all your necessary filings by using a simple calendar or tickler process, or is it time to get a bit more sophisticated? Ask yourself:ĭo you run into problems finding the data to answer common business questions? If you are dissatisfied with your existing processes, adopting new technology could help. Next, assess your current processes and toolsĬonsider your team’s workflows. The short answer, according to the IRS, is seven years. In addition to rules governing filings, there are many federal and state regulations concerning how long you must keep company records. At the same time, states and local chambers of commerce can help with local regulations. The Small Business Association and the IRS are excellent sources for information about federal mandates. Employment laws also demand proof of compliance. There are some general requirements all businesses must meet to maintain internal and external compliance, but many depend on your business’s industry, function, and location. Here are some tips for better record-keeping and implementing a records management system for your small business that will keep you in compliance. You do need something that works for your unique business needs, is easy to maintain, is organized, is easily accessible, and ties into a calendar system that alerts you of upcoming due dates. Not every business needs an elaborate system for managing records. Smaller entities can manage with lower-tech combinations of an accounting system and hard copies organized in a filing cabinet or similar storage system. For larger companies, records management systems can include a network of software programs and a process for warehousing hard copy records off-site. Records management is used to describe the company-wide solution for maintaining the official records required to stay in compliance. Records play an important role in compliance and rules apply to their use, retention, and storage. “Record” in this application refers to official print or digital data that capture a business function, ranging from leases to timecards to receipts. Record-keeping is the process of maintaining evidence of your business operations. If you use a file folder structure on Google Drive to manage your company’s work, you are using a document management system. “Document” is a broad term that does not imply any official designation or purpose. It seems like these all address the same function, but there are notable differences among the three.ĭocument management refers to how your business handles any printed or digital data, typically but not limited to work products. When talking about maintaining company records, you’ll hear the terms document management, record-keeping, and records management used interchangeably. It’s easy to get overwhelmed by the huge amount of print and electronic forms of data any small business generates daily. ![]() It is a combination of processes and tools managed by accountable employees. In this case, “system” does not refer to just software. With so many requirements to track, a small business owner’s best ally is a comprehensive, easy to use record-keeping system. Failure to do so can result in fines, legal action, and even a business’s dissolution. Small businesses answer to several regulatory agencies and are responsible for making periodic filings and payments to federal, state, and local governments. ![]() A proper record-keeping system is the key to staying on top of all the filings, fees, and regulations required of small businesses ![]()
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