How Not to Wreck Your Record Keeping

Business owners need to follow best practices in essential record-keeping. That fact would seem to need no discussion. But, key statistical research findings indicate that today’s business owners need to increase their knowledge of standard record-keeping and legal requirements for business records.
For some examples, in one business industry survey of 400 employers, 92% of employers did not know how long to retain employment records (1 year), and only 16% said they keep employee timesheets for the required 2 years. Only a third knew payroll records must be kept for 3 years, and 87% didn’t know how long employment tax records must be kept (4 years). Only 36% knew that FMLA records must be retained for 3 years, and only 39% of employers knew they must keep records of workplace injuries for 5 years. And, 78% of the business owners didn’t know tax returns must be kept for 3 years.
Creating and retaining good records starts with understanding certain basic elements that all business records should include as well as requirements for controlling access to certain records. There are even some potential long-term issues that can result from inappropriately organizing file types, which are not necessarily obvious at the time of file creation.
Here are some tips for to help b2b septic, sewer and portable restroom contractors and related industry businesses enhance your record-keeping processes. If you’ve already wrecked some of your records, you can use this information to help guide the clean-up.

What Constitutes a Record?
You’ve probably noticed that most business records fit into one of the following categories:
• Business Transaction Records — Documentation of business activities that are documented, such as sales, purchases, inventory counts, invoice creation, training attendance, etc.
• Legal or Regulatory Compliance Records — Records of business activities that are subject to regulatory or legal requirements.
• Historical Records — Documents that are needed in order to maintain the business memory, such as policy documents, meeting minutes, systemic or process modifications.
The majority of business records are paper or digital, but audio, visual, and other types of media files can also constitute records.

Controlling Access to Records
Managing file access is a top priority in record-keeping best practices. Remember that having a policy of controlling access to certain sensitive records does not ensure that access will be appropriately withheld as a routine.
To strengthen your document control system, label confidential files as “CONFIDENTIAL”. And, put in place whatever additional systems, storage arrangements, and other measures that may be necessary to ensure continual protection of sensitive paper and electronic files (including email, video and audio files) from unauthorized access.
When disposing of confidential files, make sure that these are destroyed in a manner that ensures confidentiality.

Keeping Thorough and Streamlined Records.
Make sure that all documentation is completed before it is filed. Include all relevant evidence of decisions to act and of actions taken. Include date, time (if applicable), description of the activity, identification of involved parties, and signature(s) of the record-keeper(s). Search available resources to find any missing critical information, and make sure it is included in the record.
Don’t add superfluous information, such as personal opinions or other comments, or questions. Rewrite the record to make it as verbally economical as possible. Modify Notes sections, to eliminate subjective comments, unneeded references or other unnecessary verbiage.

Meeting Legal Requirements
Some record types must be created and/or maintained in a manner that meets local, state, and/or federal requirements. Determine which of the basic purposes for a record applies to the record you are going to create.
Then, create it based on your business needs or the legal requirements for the type of record you’re building. That means, simply include all of the data fields needed to capture all information that is normally useful for either the business purposes or legal requirements that the record must serve:
• Business Needs
• Accountability (internal or external)
• Legal or Regulatory Requirements
Make sure the information is correct in the record and that it fully documents 1) decisions made, 2) actions taken, 3) and reasons for the decisions and actions.

Timeliness in Creating a Record
Don’t delay in creating a necessary record of an action that should be documented. Do not rely on your own memory to retain information for documenting later, at some more convenient time. The whole purpose of a record is to save business managers from depending upon memory.
Generally, the longer it takes to generate documentation after an event occurs, the less accurate the record is likely to be. So, by all means, take the time needed to make critical notes for proper documentation as quickly as possible after a business transaction, safety incident, or other event, to ensure that the record you create is as accurate and complete as possible.

Avoiding Information Duplication
Copying documents for use as temporary references to information can cause issues down the road. Duplicates can end up being put into the file and later mistaken for originals. This can cause originals to be behind copies and be overlooked, while users start updating the copy, assuming it’s the original.
Later, the original is found to be missing the necessary updates as well as the required original signatures or initials of people who made the updates (who may have already left the company).
Trying to copy over the missing information from the copy can cause updates that were already on the original to be out of sequence with the additional ones copied over. So, in lieu of that strategy, often the offending copy simply is stapled to the back of the original, to preserve the integrity of the record by accurately reflecting the actions taken to correct the file maintenance errors. The result is a rather confusing and poorly managed record.

Naming Records Efficiently
For paper file labels, digital folder names and easily searchable email subject lines alike—think before you assign it a name. It may seem unimportant while you’re labeling the first few files of a type within a particular category.
However, after you accumulate several dozens or even hundreds of these, it becomes a clearer priority to have all of the file names consistently coded, using naming language that is practical for the purpose of retrieving the files quickly and conveniently.
Thorough or not, perfectly accurate or not, such deficiencies may be much less troublesome than throwing away some records prematurely. The latter mistake can lead to serious legal consequences. Over the past 23 years, FLSA lawsuits have increased by a shocking 456%.
So, above all, be aware of the legal requirements for record-keeping in your business, and maintain files accordingly. On the other hand, accumulating growing masses of unnecessary records is not efficient. So, purge as much and as often as it is reasonable to do.


Business Owners Failed This Record Keeping Quiz — But Failing to Comply Is a Much Bigger Offense

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