| "body"> | | | | and indicates an honest attempt to retain |
| After you've completed the inventory of existing | | | | important information. For example, if you're |
| files, the next step is to establish user-friendly | | | | audited and you have only some records, you |
| retention guidelines. Often, offices are glutted with | | | | look sloppy at best. At worst, you give the |
| paper and computer files because people using | | | | impression that you're trying to hide something. |
| them aren't given guidelines about what to keep | | | | It's a good idea to set up and maintain a |
| and what to eliminate. Ironically, some | | | | computer database of the company's records, |
| organizations do have such guidelines, but they're | | | | including the location of all records and how long |
| not communicated to the people who really need | | | | they must be kept. This will give you the flexibility |
| them, or not provided in a user-friendly form. One | | | | to sort the information into various types of lists |
| company I worked with had a guidebook that | | | | as needed. |
| was nearly a hundred pages long, but poorly | | | | Simplify Paper Management The best way to |
| organized, and contained information most people | | | | simplify paper management is (naturally) to not |
| didn't need. | | | | create excess paperwork in the first place. A |
| As a general rule, retention guidelines are most | | | | good resource to assist you in looking at these |
| useful when organized by department, but it's | | | | issues is Cutting Paperwork in the Corporate |
| helpful to know what other departments keep. | | | | Culture by Dianna Booher ($16.95 Facts on File; |
| For example, in one company I discovered three | | | | 800--342-6621). |
| departments (on the same floor) keeping | | | | Here are some guidelines:o Annual financial |
| information about potential meeting sites. This is | | | | statements: Retain indefinitely.o Monthly financial |
| unnecessary duplication and takes far too much | | | | statements used for internal purposes: Retain for |
| space. In addition to keeping it in three places, | | | | three years.o Bank reconciliation's, voided checks, |
| they kept the information for several years when | | | | check stubs and check register tapes: Retain for |
| in fact, it wouldn't be wise to make a decision | | | | six years.o Books of account, such as the general |
| about a meeting space based on old information. | | | | ledger and general journal: Retain indefinitely, |
| Talk with staff members People who use files | | | | unless posted regularly to the general ledger. |
| regularly are the best source of information when | | | | ("Ledgers" refer to the actual books or the |
| you're developing retention guidelines. Use the | | | | magnetic tapes, disks, or other media upon which |
| records inventory form discussed previously as a | | | | the ledgers and journals are stored.)o Subsidiary |
| starting point for discussion, and determine how | | | | ledgers: Retain for three years.o Canceled, payroll |
| long people actually use the information that is | | | | and dividend checks: Retain for six years.o |
| kept. In many cases, employees may not | | | | Corporate documents, including certificate of |
| know--which is exactly the reason for going | | | | incorporation, corporate charter, constitution and |
| through this process. | | | | bylaws, deeds and easements, stock, stock |
| Talk with your advisors To further develop your | | | | transfer and stockholder records, minutes of |
| retention guidelines, collect all the information you | | | | board of directors' meeting, retirement and |
| can from your accountant and general counsel | | | | pension records, labor contracts, licenses, patents, |
| about what information is legally necessary in your | | | | trademarks and registration applications: Retain |
| company (and see the accompanying box for | | | | indefinitely.o Documents substantiating fixed-asset |
| suggestions). In some cases, your organization | | | | additions, such as the amounts and dates of |
| may belong to an industry-related association, | | | | additions or improvements, detail related to |
| which might be able to provide additional guidelines. | | | | retirements, depreciation policies, and salvage |
| The "Originator's Rule:" The Universal Retention | | | | values assigned to assets: Retain indefinitely.o |
| Guideline It's essential to keep some information, | | | | Income tax, revenue agents' report, protests, |
| but unnecessary and undesirable to keep duplicate | | | | court briefs and appeals: Retain indefinitely.o |
| information. One way to avoid this is to be sure | | | | Income tax payment checks: Retain indefinitely.o |
| everyone in your office understands and | | | | Personnel and payroll records, such as payments |
| implements, wherever applicable, the "Originator's | | | | and reports to taxing authorities, including federal |
| Rule: Whoever originates a piece of paper is | | | | income tax withholding, FICA contributions, |
| responsible for its retention!" | | | | unemployment taxes and workers' compensation |
| Document your record-keeping plan. Once you've | | | | insurance: Retain for four years.o Purchase |
| collected all the available information about records | | | | records, including purchase orders, payment |
| retention from internal and external sources, it's | | | | vouchers authorizing payment to vendors and |
| time to put the information in some sort of | | | | vendor invoices: Retain for six years.o Sales |
| user-friendly form for each department by adding | | | | records such as invoices, monthly statements, |
| the information to your File Index. If your | | | | remittance advisories, shipping papers, bills of |
| company becomes involved in litigation or an audit, | | | | lading and customers' purchase orders: Retain for |
| you'll be in a much better position to protect | | | | six years.o Travel and entertainment records, |
| yourself if you produce evidence of your | | | | including account books, diaries and expense |
| records-retention program. Having a formal | | | | statements: Retain for six years. |
| records retention program creates consistency | | | | |