Organizing Financial Documents in a Paperless Filing Cabinet

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Companies used to store the bookkeeping records of their business in filing cabinets using the space with plenty of paper documents linked to financial details of the business. These documents had all of the details in an organized fashion, such as: 

  1. Paid invoices of clients
  2. Unpaid invoices of clients
  3. Information regarding the payroll of every employee
  4. Payment records of business’s contractors
  5. Plenty of business-related files which are important yet of no specific use at the moment

These paper or cabinet files are never easy if you are looking for important data and viewing those records turns into a troublesome task. If a company is planning to prepare for the upcoming tax season, they need to review all files to collect the required data.

However, today we are lucky to have more technologically advanced management systems that have made the process much easier and more convenient for all accountants and bookkeepers. In this technological era, companies have a proper computerized system for entering all of the records of the company including the employee management system, product management system, inventory system and customer management system. All of these systems have made it easier for a business to locate any kind of digital data and use it easily. Similarly, if businesses adopt electronic filing methods for financial documentation, it is much easier for them to store data, locate it within minutes, retrieve information and share all bookkeeping records with other authorized employees digitally.

Getting Started with an Electronic Bookkeeping System

If your business is currently using the manual paper system for bookkeeping, this is the ideal time to turn towards digitalization. Digital bookkeeping has many benefits over the traditional bookkeeping system. It saves the time of the employees, retrieves the information much quicker, and even saves office storage space.

However, if you are considering the shift towards paperless filing of your financial data, you need to make sure that you make a proper back up of all of the information on a cloud so that you can retrieve it in case of an accident or data loss.

Shifting from a manual to a digital system will require time and effort at an initial level. A company needs to train their current employees regarding their new document management system so that they can get familiar with the system outlook and technicalites. The process of going digital starts with finding or outsourcing the design of an easy to switch document management system for the company. The designed system should keep the company’s business in mind. The main idea to avoid online cloud services such as Google Docs or Dropbox to maintain the security of the sophisticated data of the business. It is ideal to look for an enterprise management system for documentation such as a file cabinet. The file cabinet has multiple packages with plenty of options for accountants such as drag and drop storage systems, sub-folders for more organized data management, and a utility for scanning and searching the text.

When you have finalized your document management system, you can simply get started by forming all of the folders for your company. Designing a structure of your folders is the key to an organized management system. These folders may include sub-folders for all of your necessary financial accounts. Examples are below.

  1. Accounts Payable
  2. Accounts Receivable
  3. Vendor Receipts
  4. Banking
  5. Payroll
  6. Tax
  7. Loans

Once you are done creating a proper structure for the folders, you can put all of the files into these folders and organize your data in paperless filing cabinets.

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