How to Store Client Files for Your Accounting Business
Making the decision to store your client files online is one of the best ways to ensure their safety. Hard copies of files can become lost or damaged, creating a problem for efficient retrieval, should the need arise.
A general retention policy is to keep all current and former client files for ten years. This can add up to quite a bit of paperwork if your client decides to leave after several years of work. Instead of having to stand and make photo copies of all of their paperwork, wouldn’t it be easier to copy a few files online, zip them up and send them along to your client? Absolutely.
By storing your client’s files online, you’ll have the convenience of categorizing by the client’s last name, and then subcategorizing by year. Everything will be easy to locate when referencing certain years, receipts, or other necessary data. Sounds pretty elementary, but many accountants and bookkeepers who work independently make the mistake of becoming overwhelmed with file storage issues.
Just because you’ve struck out in business for yourself and possess awesome accounting skills, doesn’t necessarily mean that you are the most organized business person. If you’ve caught yourself storing client files on your computer’s hard drive (or even worse; your desktop), you are well on your way to a filing dilemma. All it really takes is one busy tax season and you’ve got a potential mess on your hands. You can take care of this before it becomes a problem, with an online storage system.
Large Files
Another reason to store your files online is the fact that many of the pdf’s you’ll be dealing with, such as scanned copies of receipts, take up a lot of space on your computer. Storing large files online is a quick and easy process with My Docs Online. There’s no limit to the files you can store and it’s a simple drag and drop process. Plus, your files will be safe, neatly organized, and easily retrievable by yourself, your client, or your coworkers when necessary.
Now that pdf and scanned copies kept online are accepted by the IRS, more offices are becoming paperless.
What to Keep Readily Available
Just because you are going to get organized, doesn’t mean that you are going to become a filing cabinet for your client. Be sure to set up a policy with each new client, and have it in writing. The policy should state how long you will keep your client’s files, how often they can request information without an additional charge, and what administrative fee you will charge to pull archived files. Generally, you’ll need to have the most recent year available to your client at all times, and possibly the prior two years. After that, the rest is considered to be archived.
Be sure you are aware of the laws in your particular area. A good resource for information on document retention is the American Institute of Certified Public Accountants (AICPA).
Also keep an accurate archived document list. This will greatly simplify your duties and make your files accessible at all times. Archiving files online is a simple solution to the unnecessary legal complications of destroying records.
One vital element of business start ups that is often forgotten until the last minute is the subject of file storage and file sharing. With proper planning in this area, your business will operate more efficiently and you will appear more professional when dealing with new clients. There’s nothing that screams, “I’m brand new to this business” more than having to set up your file sharing account almost as an afterthought.