Understanding Your Organization’s Records Retentions Policies

“Seven years”, they said…

And that’s how the story goes every year. When December 31st rolls around, the conversation at the office starts with generating ideas on how we can best purge the records that we don’t need to keep anymore.

Our Accountant would say, “I know it takes up a lot of space, but they said that I have to keep these records for 7 years.” When I say “they”, I refer to the Canada Revenue Agency (CRA); and when I say records, the CRA defines them as the following*:

  • Ledgers
  • Journals
  • Vouchers
  • Financial statements
  • Tax records
  • Invoices
  • Purchase receipts
  • Payroll
  • And the list goes on…

If you are running a business that is reliant on records, then the papers and filing cabinets fill up fairly quickly. For a business that is growing, the fruits of your labour will eventually lead to records that have to be kept in storage (sometimes known as ‘the basement’) for those specified number of years.

Certainly there are pros and cons to keeping paper records:

  • While they are easily accessible, individual files are also time consuming to locate.
  • Files are kept in a central location, though the safety and security behind them can be compromised.
  • Records are sorted by your own methodology, which may not be easily understood to another employee within your organization.

The purge that we performed last year was the final straw – it took too long, did not follow a consistent process, and was not as easy as just putting the records through the shredder.

As we went through the boxes, a common set of questions and answers came up:

  • What if we needed them later on?
  • What happens if I wanted to pull up purchase orders by a particular customer?
  • If something happened to these records, then how easy would it be for the client to recover or replicate this information?

A few days went by, and another set of questions and answers ensued:

  • “I would figure out a way to find them – but it would take some time.”
  • “I would go through the boxes and pull out the right records.”
  •  “…”
    • Is there an affordable way to manage these records so that they are readily accessible?
    • How easy is it for a client to implement a system to store their records?
    • How much time would it take to store, manage, or query a record?
  • “A lot more affordable than you might think. Our clients also seem to be experiencing on a daily basis.”
  • “Depends on the types of records. We could have them up and running in a matter of days.”
  • “It would only take seconds…actually.”

The industry calls it “content/document management” – and investing in a content management system is one of the best ways to keep your records in a safe, secure and accessible environment. Whether these records are stored on a cloud platform or private server, the ability to quickly pull these records using whichever search parameters you want is made possible with an effective system. Our pain was resolved thanks to a content management system that allowed us to index (tag) our records so that we could find any record within seconds.

Content management platforms used to be something that was reserved for big business. The price tag used to be high, the training used to be extensive, and the services that the platforms provided were highly customized based on needs. Thanks to recent advances in technologies, small businesses now have the opportunity to invest in similar platforms at a fraction of the price.

We see a tremendous amount of value in content management, and educating small businesses about it is one way we can get people talking about it. Trust us – it’s easy, affordable, and gives you peace of mind!

For more information on records retention strategies and the services we can offer, call DigitalOffice.ca today.

*Take a moment to find out what the records retention policies are for your business and industry. It will be very important for your company to understand them. Please visit the CRA website for more information on the Federal Government’s approach to electronic record keeping policies.