Electronic documentation and e-signatures offer accountants and practices many benefits including time and cash savings. But how do you ensure that your files – and more importantly, your client’s information and data – is being stored securely?
Here, Mark Woolley of Reckon Software offers best practice advice on safeguarding your files for optimum security when using electronic documentation.
Poor data storage and security is costing UK businesses their money, reputation and time. We’ve seen in recent news, the TalkTalk data breach being one example, that even sizeable companies are not immune to the growing threat of cyber-crime.
The General Data Protection Regulation (GDPR), which will come into force in the UK before we leave the EU, will allow accounting clients to claim damages for data loss and unlawful processing. In fact, the UK Information Commissioner has already suggested that up to £5 million may have to be budgeted by some large organisations for compliance reforms.
With such high fines at risk and reputations on the line, businesses need to seriously re-think the way in which they store information and data.
So, what can accountants do to ensure they are ready for information and data storage in our digital age? The answer is simple – go electronic.
Electronic Document Management (EDM) systems use secure web interfaces that allow better sharing of information, via phone, desktop or tablet. Encryption level security settings, disaster recovery in case of fire, floor or cyber-attack and compliance with EU data protection regulation are all part of the electronic documentation package.
But with numerous EDM systems on the market, how can accountants and clients make sure the system they choose offers the level of security needed today?And, more importantly, how do we get the most out of such intelligent software?
- Trust electronic signatures
Remain competitive and invest in a future proofed system that offers an e-signature facility.
As electronic signatures become more readily accepted as legal evidence, it’s important for accountants not to doubt their reliability over handwritten signatures. In light of new regulations that became effective in July 2016, the benefits have become text book and electronic identification is expected to fuel e-signature adoption.
For businesses with various office locations, this feature is particularly important and will help to ensure internal as well as external reassurance. Accountants will no longer need to rely on postage to receive signatures, making administrative procedures faster and more reliable.
- Encrypt your data securely
EDM systems offer the option to encrypt your client and personal data, it is of the utmost importance that users do so to the highest possible level, particularly when transferring information via email.Exchanging documents is even more secure when it’s done via a secure portal. As portals become more popular, transferring data via email will become out-dated.
Encryption is key to safeguarding accountancy data and reputation. No excuses, the tools are there and must be used to comply with the law.
For the highest possible security level, look for a system which holds a recognised certification.
- Control in-house documentation
Accountancy businesses are just as liable to a security breech internally as well as externally.
It is paramount that data sensitive documents do not land in the wrong hands. To avoid legal implications, businesses can use an EDM system to assign security levels for all staff members accordingly.
- Ensure that the system meets best practice advice for ICO
The Information Commissioner’s Office (ICO) has indicated that sensitive personal data should not be transmitted unless encrypted to current standards. If businesses abide by their recommendation, there should be no room for error or legal liability – something all accountancy firms surely wish to avoid.
Whilst businesses can blame lack of time or understanding, regulations which will come into force in May 2018 will make the task of securing data mandatory for all accountants handling client accounts.
To future proof your business, spend time researching the right EDM systems, speak with experts in the field and find a system that is simple to use and complies with the law.
Mark Woolley is commercial director at Reckon.
“Original publication in Finance Digest Issue 1 https://www.financedigest.com/