Managing Financial Documents and Tax Records during Hurricane Season

Managing Financial Documents and Tax Records during Hurricane Season

Departmental records and other important documents can be lost during disasters such as fires, floods, earthquakes, explosions, military conflicts, or terrorist attacks. They can also get damaged during emergencies such as power outages, security breaches, or insect infestations. When documents are lost or information on them is compromised, the organization will find it difficult to meet operational objectives and make important decisions. Managing documents such as tax records and financial documents is essential to avoid financial risks and to carry out the organization’s activity efficiently and effectively.

According to recent news, the Louisiana Department of Revenue is encouraging taxpayers to protect tax records and other financial documents from disasters and contingencies likely during the hurricane season. In fact, they are taking major precautions and making adequate arrangements for the safekeeping of valuable documents, if any emergency situation crops up.

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Paperless Storage

Paperless storage or digitization allows documents to remain resistant to natural calamities such as flood, fire, hurricane, and so on. Keeping bank statements and other financial documents in digital format is the ideal solution, as this will keep the records secure and safe, without acquiring much of the storage space.

Documents on tax returns, W­2s and payroll records should be scanned and indexed, before making them available in digital format.

Another option to protect documents (in digital version) is by using the mailing option. Google’s Gmail and Microsoft’s Hotmail offer account holders free online data storage. The facility allows users to upload electronic records from their home computer or PC and retrieve them later through any electronic device connected to the internet.

When going paperless, organizations should keep the following tips in mind •

Manage documents wisely by implementing a method for organizing and searching files

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Always keep backup records in more than one place

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Scan and file every document involved including paper files, images, and microfilms

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•

Implement a document management solution that meets the regulations of financial industry

Arranging Documents Securely When paper records become wet, they are extremely vulnerable to damage.

Preventive preservation of paper­based documents is necessary to reduce the risks of damage, to slow down the rate of deterioration, and to restore useful access of information. Paper records can be protected from damage in the following ways.

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Cover paper documents with waterproof covering such as plastic sheet or tarpaulin

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Do not store valuable documents in rooms subject to regular flooding or water damage

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Install water alarms in areas subject to water leakage or flooding

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Documents should be placed in airtight plastic containers or zip closure bags

Document security is a prime concern, as far as financial documents are concerned. Today, many business organizations and archival institutions are digitizing their valuable documents. With document image processing, one can combine the processes of scanning­storing­retrieving and managing into a single unit, thereby facilitating smooth access and retrieval of documents. www.managedoutsource.com

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