04/04/2024
Effectively managing accounting documents to meet legal and regulatory requirements is paramount for any accounting division. When documents are difficult to locate or missing, it can create serious problems during audits and limit cost analysis. Modern Enterprise Content Management (ECM) systems streamline this process by preserving documents and data for tracking accounts payable, accounts receivable, operational and capital expenses, and cash flow. Indexing these documents makes them searchable for quick retrieval, while access rights, organized information, and advanced security help enforce compliance with GDPR, HIPAA, and Sarbanes-Oxley. It also makes it easier to enforce policies for confidential documents. These features help to plan budgets and ensure that documents are not missing during audits, which can create complications.
Implementing an ECM system for accounting documents can bring about improved data regulation in five distinct ways.
Auditing paper-based or manual spreadsheet file-based systems can be a major headache for accounting departments and auditors alike. Picture this: the auditor requires access to all invoices from 2021, and they are all housed within multiple spreadsheets or physical filing cabinets. The auditing process becomes tedious and laborious as the auditor painstakingly searches through each document. Digitization using ECM can offer auditors the ability to search and access records quickly and only with permission.
Document management features within an ECM platform bring the accounting department into the 21st century, allowing them to respond swiftly to auditor requests. Search criteria can be customized, and full traceability of every document capture, version, annotation, and workflow is recorded for clear transparency. This helps streamline the auditing process and provides greater control over business information.
Creating an audit trail is critical for safeguarding confidential accounting documents, data, and financial information. Particularly for publicly traded companies, this is a necessity to comply with the Sarbanes-Oxley Act. Enterprise Content Management systems can provide the highly detailed audit trail necessary to keep track of who accessed, printed, or edited these records. This trail ensures that corrections proposed by auditors can be made swiftly, as well as provides a reliable history of actions, which can help with determining responsibility if fraud or other confidentiality issues arise.
Retention schedules for paper-based documents or spreadsheet files are an arduous, laborious process. Your team has to manually track the age of each document and then discard them according to industry, state, and federal regulations. This can be a daunting task.
However, an ECM platform has the capability to capture data such as storage and invoice date, allowing for automated workflows to be initiated. With this system, you can establish rules to dictate how long to keep specific document types, such as invoices and financial statements. The system can also automatically purge documents that your organization is not obligated to keep. This offers a powerful solution to ensure your company is compliant with regulations and is well protected from legal action.
When conducting a cost analysis, enterprises often need to access information that isn't stored in their ERP or accounting systems. This data can be located in invoices, supporting documents, and spreadsheets. But relying on spreadsheets is not an efficient way to report and analyze costs. To ensure accuracy, businesses should use a software solution with rigorous security standards, version control, and integration capabilities, which are exactly what Enterprise Content Management software provides. This will allow the accounting team to focus on creating scenarios and analyzing data rather than reconciling and checking it. With an ECM solution integrated into the existing organizational technology infrastructure, a cost analysis can be much easier and more reliable.
Creating a budget that is fact-based requires more than just reviewing financial statements. To gain a more thorough understanding of what drives a number, an analysis of the related documents must be conducted. This greater transparency allows department managers and executive teams to accurately predict future capital and operational costs and to assess whether to keep or switch services. The way documents related to accounting are managed can have a substantial effect on the control of information that affects the bottom line. By embracing a modern Enterprise Content Management system, documents can be retrieved immediately, thus promoting the success of potential audits and ensuring more precise budget planning and expense analysis.
Helix International is a top provider of Enterprise Content Management (ECM) solutions, with a proven track record of over 30 years in implementing and migrating ECM systems. Boasting a team of over 80 ECM developers and data engineers worldwide, Helix has the skills and experience to successfully execute any ECM project. Contact Helix International for expert ECM solutions.
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