Understanding the benefits of document management software for accounting firms – whether it’s on site or cloud based.

Because of the increased demand to be able to work from home or anywhere, accounting and finance firms are ditching their heavy use and reliance on paper and transitioning to an increasingly digital way of working. An effective and secure document management system is an essential tool that every modern accounting firm whether large or small wants to implement ASAP.

While there are still some compliance mandates regarding physical record retention, it’s still possible to reap the many benefits of a document management system for accounting firms. When you want to retain records, access them from anywhere and lower the risk of experiencing a data breach, cloud-hosted platforms can be the answer.

Why Does Your Accounting Practice Need To Retain Records Securely?

In a world where companies from all industries handle more data than ever (client details, payment info, employee details, contracts, business plans, product info, etc.), the need to retain records in a safe and secure fashion is greater than ever. In addition the amount of PII (personally identifiable information) on the documents that are generated by accounting firms, tax professionals, EA’s etc is enormous. The IRS and all states mandate that this information be kept safe. However, this aspect of data and cyber security is often an over looked area by large and small firms alike.

The following cyber security stats should confirm why this aspect of your business needs more attention;

• Hacks occur every 39 seconds (1), underlying the constant threat.
• 43% of cyber attacks (2) target SMBs with under 1,000 employees.
• 52% of data security breaches (3) come from human error or system failure.
• Data breaches in 2020 are set to cost businesses an average of $150m (4).
• Over 71% of data breaches (5) are financially motivated.

Regardless of the firms size the need for cyber security could not be greater. Prevention is one of the best forms of protection, particularly in relation to retaining records and important data files. Cloud-hosted document workflow software for accounting firms are a great option and if you’re not ready for the cloud based version, there’s on site and hybrid systems available.

Document Management Software for Accounting Firms – On Site or Cloud Based

What Are Cloud-Hosted Document Management Systems?

The term cloud-hosted document management system for accounting firms defines a range of systems and platforms that are used to manage your company’s files and data via cloud-based servers rather than the physical storage spaces traditionally used in business, such as on site servers.

Cloud-hosted document management systems store data in secure virtual data centers to promote improved organization and real-time collaborations that cover all documented files, processes, and workflows.

Like an on-site document management system, the cloud-based solutions use a defined set of processes, along with technical and practical standards to achieve the desired results. It supports the integration of custom work flows and and can index and use metadata and even facilitate electronic signatures.

In many ways, the cloud-based document management system is simply another iteration and option to traditional on site systems, which is why it is adopted by scores of firms every month.

Why Cloud-Hosted Document Management Systems Work

Businesses use cloud-hosted document management systems for many reasons, including environmental benefits, cost savings, and regulated compliance. However, the biggest advantages potential advantages relate to anytime – anywhere secure access and cyber security, especially for smaller firms. 

Most companies that are new to the idea of using cloud-based data storage for private records have concerns relating to potential data breaches, but some of the features to consider regarding these concerns are: 

• Cloud-hosted document management software for accounting firms incorporate the latest cyber security tools ranging from encryption to access control and certifications. Furthermore, the systems automatically enforce strong passwords and and additional security controls like two-step verification.
• A range of technical issues can all be avoided by having a reliable provider that monitors all situations and has automated monitoring and alerts in place. Moreover, automated secure backups and multiple version histories prevent complete loss even in rare circumstances where technical faults occur.
• Virtual data centers employ the latest cyber security systems and physical access systems as well including Key card access, backup generators, and other essential security measures to help deliver a comprehensive level of total protection.
• The automated compliance and custom environment reduces any issues with software compatibility to ensure that firewalls, encryption, and key attributes offer the 360° protection that your firm needs and allows you to reassure your clients or meet any compliance recommendations or mandates.
• In addition to creating stronger defense systems in the digital arena, using cloud technology removes the threat of data loss due to damaged hard drives and on-site servers. Earthquakes, floods, computer corruption, and physical theft will no longer threaten your data either.

The use of on site or cloud-hosted document management software for accounting firms can take your firms data protection and workflow possibilities to new heights whether in an onsite physical configuration or in a virtual cloud environment. In turn, the reduced risks of data breaches translates to both financial and time savings.

While there are several steps to consider when completing the digital transformation, such as document classifications and access credentials, the right document management system will guide you through the process and decision to determine which one is right for you.

Give Alavanca Systems a call today, and we’ll help you explore all of the possibilites and make the right choice for your firm.