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Conscious filing for the everyday business

What does your filing look like? A bit so-so? Or totally immaculate? There is no right or wrong really, if you have a filing system that works for you and you stick to it – you should be ok.

You are probably thinking filing? That is not going to leave me smiling! It doesn’t make you bucket loads of money so why should you focus too much on it? I will let you in on a secret;

A good filing system means good things for your productivity and profitability!

A nice and organized filing system is vital to your business, here are a few reasons;

• Quick and easy access to financial records in case of an audit, or verifying information
• Allows you to see where your finances are including unpaid invoices and bills, or open jobs
• It will keep you conscious of filing you may not necessarily need to keep, and information you need
• Clients will expect you to keep their information secure. An organised filing system ensures this.

Paper Vs Electronic Filing

Paper Filing

Manilla folders or level arch folder with dividers for each month, along with labels so they can be accurately identified. Be consistent in your labelling so there is no confusion.

Filing by date gives a logical sequence, which will make things much easier to find when it comes to the end of financial year. You will have a folder for each month and within each month, file the documentation alphabetically.

Try to have a folder for your expenses each month or quarter, along with separate folders for BAS, Payroll reports, insurances etc.

Pros of paper filing

• You can physically see a folder and see where a document should be
• Generally, less complex and easier to locate certain documents
• Less training required

Cons of paper filing

• Documents and information aren’t available outside the location of the records
• A lot of space is taken up
• Fires or flood will wipe out all records
• Easy to misfile a record or not be able to locate it

Electronic Filing

I would recommend creating a folder on your computer for each year, and sub folders for each month and proceed to scan and file the documents in the relevant folders as you would do with a paper system. Don’t forget to have your data backed up.

Be careful in disposing of any paper you have scanned and filed electronically as it may need to be shredded first.

Pros of electronic filing

• Information is available from different locations
• Minimal space is taken
• Information can be back up in different ways
• Information and records can be quick to locate
• Information can be password protected if necessary
• If a record is misfiled you can do a search of the folders, find and easily move to the correct location
• Documents can be stored in multiple places
• Information can easily be shared with others

Cons of electronic filing

• Information can be compromised by Hackers or a virus
• Can be quite complex which requires more training of staff
• A good back up system will be needed
• You need to add statements or other attachments

If you have any questions, please do not hesitate to contact us on (02) 4934 4260 or email us on reception@plhaccountants.com.au.