The Basics of Business Record Keeping

In my experience working with entrepreneurs, there seem to be two main camps of people: those that save absolutely everything forever and those that couldn’t show you yesterday’s receipts if their lives depended on it. Clearly, neither of these is an effective way of keeping records within your business, so what do you really need to hang onto and what should you get rid of in an effort to de-clutter and get organized?

Firstly, you absolutely must keep the basics on hand because you’re required by law to have them. The basics include your primary business documents (such as the articles of incorporation, by laws, and any permits you’re required to have), your financial and tax information, any business agreements (such as contracts with suppliers or customers or employment agreements with your staff), and legal documents (such as board meeting minutes and records of any decision making and anything else) to prove you’ve met legal or regulatory requirements that apply to you.

For everything else that you’re not legally required to keep on hand, it can get a little trickier to decide what should be saved and what should be tossed but there are a few times when you definitely need to keep the files. Of course, if you’re involved in any litigation of any type, keep anything that may be relevant until that litigation is concluded. If your business still relies on the information, obviously, keep it around until it’s no longer useful. If there are regulatory actions underway that could affect your business or what you need to have around, stay on the safe side and keep it.

After you’ve put a system in place for keeping track of your records, make sure you’re also doing what’s necessary to keep those records safe. If you’re holding records that fall under specific categories and need extra care, like medical records, which must follow HIPAA standards, for example, obviously make sure to abide by those regulations. For everything else, you should still be sure that your records are properly secure from things like flood and fire and from theft or just wandering eyes. If the records are especially important and are in hard-copy form, it’s probably advisable to make e-copies of everything and make sure that everything is backed up so that you will never really lose those records should something happen at your office that wipes out the physical documents and destroys your computer.

By carefully crafting a document control strategy, you’ll be in a much better position with your business in terms of both legal compliance and organization and efficiency. The sooner you implement such a strategy, the better off you will be, so don’t wait to get organized or you may find yourself in hot water.

A lot of the information for this video came from an article by Dave Clarke over at the Intuit blog and you can grab the link below the video if you want it.

Now I want to hear from you. What’s your system for organizing the documents that you need to keep and getting rid of the rest? Are you super organized or is your record-keeping a mess? Weigh in in the comments section below.

If you found this video helpful, please spread the love and like it and share it with anyone who might be interested.


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