Keeping your Records In Order
Today I will talk about something as mundane as filing papers. I feel that this is one aspect of setting up a business that is least paid attention to. What I am referring to is the maintenance of a proper filing system for business documents.
How many of us have indeed given thought about this aspect of the business? In fact, for those who have small cottag- industry type of businesses, are your records organized in such a manner that if an inspector came over and asked to see them, would you know where to get the necessary papers and be assured that they are in order? Are they up-to-date? Should a complaint be filed against you, would you have the documents to support your defense?
If there is one thing I learned in the last couple of years, it is that it's not enough that the bills and dues are paid. What must be remembered at all times is that all these receipts and documents should be safely kept in order. These documents I am referring to will include the following: human resource documents such as the payroll sheets, vouchers, 201 files and contribution records as well as all forms filed with the Bureau of Internal Revenue like the Value Added Tax Form, Income Tax Returns, Withholding Tax Forms, etc.
Lack of diligence in properly maintaining records can be a source of many problems later on and iit can become costly at that. As an entrepreneur, you are in the business to make money and with this comes the opportunity to give employment to the growing number of Filipinos in need of a job. And just like anything that is important and operational, proper administration is required.
Keeping our records in order is not singularly for businesses. This is something that must be applied to every aspect of our life. I know of a person who keeps a hard copy of his mobile contact list in his wallet. This practice has served him well as he never had to worry about losing anyone’s number.
Another example would be in the claiming of retirement benefits from the Social Security System. Often, in cases of similar registered names, it becomes essential to not only present one’s SSS Identification Card but also supporting documents that show proof such as employment certificates and Birth Certificates issued by the National Statistics Office.
Just as you worked at obtaining identification documents and clearances for job applications or kept all your school records and awards from the time you first started in school, so should you be careful in maintaining business records. These documents are usually considered active for three years. As an example, let’s take the filed income tax return for the year 2005. In this case, you should have all the supporting documents such as the receipts used in the creation of the financial statement and the balance sheet as well as the external auditor’s report intact for the next five years within which time it may be reviewed, examined and corrected by the BIR.
This topic may be mundane but it is not trivial. Maybe it’s time we all clean our house and get organized. If all your documents are in your hard drive, make sure that you have back-ups. Update them and make sure that you have a safe place – water and fire-proof to store them in. Most important of all, ensure that there is more than one person who know of the whereabouts in cases of emergency. |
