Moving to a paper-less office can often be cause for anxiety. Losing the comfort of close contact with client files, folders, contracts and reports piled up in your office in favour of digital directories mysteriously sitting on a PC or in the cloud somewhere can be confronting.
But as with all change, often the anxiety is based on uncertainty rather than reality. Today I’ll take you through some high level legal considerations you should make when choosing an electronic document management system (DMS).
While electronic document management systems may seem new, the regulatory environment has long recognised that document management is going paperless. Both the ATO and ASIC, for example, are comfortable with accountants and small businesses owners meeting their document retention obligations in a digital format and recognise that document management systems are becoming digitised. In the same way that digital signatures (via AUSkey) are recognised by the ATO for lodging tax returns online, ASIC also accepts electronic lodgement of an ever-growing list of company secretarial forms.
Know your legal responsibilities
A good place to start when looking for an electronic document management system is to familiarise yourself with the expectations of the law. In broad terms the key requirement is that any digital document management system must be able to create, record, copy, store and reproduce documents in a way that maintains the integrity of the original and that is readily accessible in a real world format for subsequent reference.
The law doesn’t prescribe what technology you need to use, so as long as you can meet the broad requirements that will be enough. The ATO has released a few guidelines on the topic that go into a little more detail than the general legislation.
When looking at an electronic document management system the ATO is generally concerned with whether it can do the following:
- Can it define user rights and regulate access?
- Does it have a backup facility?
- Can documents be retrieved easily?
- Does it convert into a form readily readable and retrievable?
- Can the documents be indexed and easily identified?
- Is there a text search facility?
- Does it record identifying information such as author, signatory, date created?
- Does it have an audit trail to monitor access and changes?
If you want to tender electronic documents as evidence in court, then generally they are accepted provided you can use your DMS to show:
a forensic chain showing the integrity from original to copy;
- tracking of version changes;
- tracking of software upgrades to the system;
- activity logs.
Finally, ASIC very generally says by all means keep your documents electronically so long as they are easily accessible in the English language.
As you can see there is a technology neutral permissive environment in Australia that encourages electronic document management. Always ensure your system meets the standards and you’ll be able to go digital without the angst.
Find out about Reckon’s electronic document management system, Virtual Cabinet here