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The case for digitized perm files

Having lugged around three thick files representing the full permanent file for an audit client for the past few weeks, I’ve come to the conclusion that my firm needs to consider digitizing these things.

Perm files for accountants consist of client documents that carry forward year to year. For example, engagement letters are good for three years before they need to be updated and signed the client again, so a copy goes in the perm file for that time. Loan and lease agreements and their related payment schedules straddle multiple periods, as do rebate/royalty/license agreements. Articles of incorporation or amalgamation, and anything to do with share purchases and sales.

There’s no good reason to continue to keep physical copies of all these documents, rather than storing them in PDF or similar format and printing them when a hard copy is required (if ever).

The advantages are many:

  • Cheaper to store
  • Can easily be reprinted if hard copy is ever required
  • Increased mobility due to weight savings and digital format
  • Backups are simple and easy to do frequently
  • More secure storage on protected hard drives
  • Searchable (becomes really helpful as the file gains documents)

The same can basically be said for digitizing whole work paper files each year, but there are still situations where having a physical copy with work done directly on it is needed. I think tablets could be useful in ushering out the era of paper-based files, but who knows when the big firms will start to use them.

How far away from a truly paperless client file system is your firm?

2 replies on “The case for digitized perm files”

Funny that you mention it – I’m a hardcore “anti-paper file” partisan, and working in IT audit, it’s studidly easy to convert paper to digital.

Well, I mean, ‘regular’ audit teams could also do it, but they also have more paper to sift through, which can make the act daunting.

Just a month ago a found myself having to run around to find a permanent paper file that belonged to another office.

I wasn’t pleased with the run-around associated with the search for the file (the senior who knew where it was located, was on vacation for the first week of a two week job!).

I resolved to eliminate the paper file component from my work on that client. Since most of my data is generated electronically, it’s not hard to say to the client, “just send me the file, don’t print it”.

I took the remaining “legacy” permanent file documents, ran them through our document station, and *poof*, all those heavy papers were PDFs. If you have a choice, always go with PDFs – don’t even consider ‘similar formats’. ;)

Through it all, I had one of my several Good Managers, who was wholly supportive of the action, also recognizing the benefit from my act.

So yeah, paperless client file systems arehere. The future is, like, ahead of schedule. :)

Paperless? DUH!

Reminds me of a joke I heard a long time ago:

Why did the auditor cross the road?

Because that’s what they did in last year’s workpapers.

Let’s face it, the paperless argument has been going on since the 90’s – the technology is there.

The profession needs the new generation to step up and make it happen.

So next time, instead of lugging the file – scan it, organize it in a digital file cabinet – and tell your manager to carry the paper file if he/she needs it so bad.

Dave

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