document management? automate it

solutions for firms of all sizes.

by roman h. kepczyk
quantum of paperless: technology guide & checklist

the network drive in most firms is not very well organized and requires the most cleanup. this happens because it is usually managed with microsoft windows explorer, which allows almost anyone to create or access a file anywhere on the drive.

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unfortunately, there is seldom a firm standard that is adhered to, allowing users to create files with any naming convention they want and store it anywhere they choose. the result can be files that are hard to find and slow to search across the network.

when we analyze firms, we find that there is a significant amount of redundancy in files, with multiple versions on network drives. these drives need significant cleanup. while a solution would be to open every file, compare it to other versions, verify its contents and naming criteria, the time to do this for all documents is not practical. so, the solution for managing documents in a paperless environment is to use a tool that will force adherence to the firm’s document retention standards. this is done best by a document management system, which the cpafma paperless survey found that 80 percent of firms had already implemented.

document management systems come in a couple of levels with the simplest being “flat file” databases such as thomson reuters’ file cabinet solution, smartvault and intuit’s lacerte dms, which create an index to quickly find files. these are very cost-effective tools for firms  to get started with and support firm standards for file naming conventions and directory structures,  so they are recommended over using windows explorer, even if just used for a couple of years with the intent of going to a more robust solution at a later time. while flat file solutions are effective for small to medium-size firms, file access speeds can eventually slow down beyond the point of annoyance, as the size and number of files increases.

the next level would be the more robust databases such at wolterskluwer/cch document, conarc ichannel, doc.it and thomson reuters gofileroom that run on much more robust (sql server) platforms. these tools are significantly more expensive to implement but usually provide better performance for medium to larger-size firms as well as more robust features for document search, retrieval and retention. these products usually have an integrated portal to transfer files to and from a client as well as more sophisticated audit trails to help with version control and determine who is authorized to access a specific file. firms need to be serious about implementing and adhering to a document retention policy.

while thomson reuters gofileroom started the trend toward cloud-based document management for accounting firms, wolterskluwer/cch has responded with their axcess document management tool and other vendors such as smartvault are optimizing their solutions for the accounting profession. again, an advantage to consider for cloud-based document management systems is that the provider is responsible for all backups, disaster recovery, updates and expansion of space, which can quickly become a burden when smaller firms grow or merge with another practice. cloud-based document management systems also allow for much easier expansion at a managed cost than on-premise document management systems, which usually require the firm to project the next five to seven years of use and must be paid for up front including backups for disaster recovery.

recommended action: transition firm files to a document management application.

posted on december 8, 2020