In the digital age, compliance is an especially significant priority for bookkeepers and accounting firms of all sizes, whether your business spans a single city or the entire globe. If you don’t take compliance seriously, it will eventually come back to haunt you – possibly in the form of significant legal and financial consequences.
Much of the emphasis on compliance is about security and protection: how to stop external forces from physically or digitally stealing key data. These topics are important, but there are some other compliance steps that may not seem as obvious at first glance. Let’s talk about these less common strategies for compliance and why you may want to consider them the next time you work on your firm’s methods in these areas.
At first glance, it may not seem like onboarding – the way you bring on new employees and contractors to help them get prepared to work in your business – has a lot to do with compliance. For most firms, these processes typically involve things like getting an employee set up with the payroll system or explaining how the firm’s software systems work.
Onboarding is also a massive factor in the relative success or failure of your compliance tactics. That’s because onboarding provides the foundation for how members of your firm think about security and data protection. Consider how many different things you do each day while working, mostly because that’s the way you’ve always done them. The same concept applies to your team: a lot of the approaches they use for things like file sharing and password management are simply what they learned when they first started. If you can shore up your initial onboarding and training policies, you’ll create a stronger foundation for compliance throughout your organization.
One of the bigger selling points of cloud-based file sharing is its convenience: with these platforms, you can edit files seamlessly from any location. But cloud-based document sharing may also help improve your firm’s compliance, since the most reliable services have secure file encryption protocols that will keep your project-related forms and records safe. Choosing the right platform on which to share project documents can give your firm a boost in both efficiency and compliance.
The one caveat here: cloud-based file sharing that’s not protected may put your clients’ data at even greater risk than traditional file sharing. Be sure to select a platform that uses a strong enough encryption platform before migrating all of your digital assets.
Software updates are an overlooked compliance tactic in the sense that they’re often forgotten in the busy whirlwind of day-to-day project work. However, keeping your firm’s software current is very important for making sure you stay in compliance with applicable laws and regulations. Outdated software is a much easier target for hackers looking to steal data. Even if all your other security measures are up to snuff, a seemingly minor mistake, like not updating software, can cause major compliance problems after a hack or breach.
To be sure this doesn’t become an issue in your firm, add a process for software updates to your recurring list of tasks. Some software tools will even allow you to automatically schedule updates and notify you as they happen. This kind of automation will greatly increase your chances of staying in compliance with laws regarding data security.
What does talking to clients have to do with your compliance? A lot more than you might think! With a relatively brief conversation about security and compliance, you can ensure your clients don’t unknowingly compromise the safety of their data – or other clients of the firm. Most bookkeepers and accountants know that even if their clients create a compliance issue, it’s ultimately the firm’s responsibility to ensure that data is kept secure throughout all steps of the working relationship.
That’s why it’s so important to communicate with your clients about compliance, both before you begin working with them officially and throughout the time you spend completing their projects. Be sure to remind them consistently about what they should do so that you both can stay in compliance and avoid hefty fines or other legal repercussions.
While we’ve discussed some of the most important individual steps that need to be taken for your accounting firm to stay in compliance, there is one overarching approach to follow for the best results: connecting all of your bookkeeping firm’s different processes through a single platform that allows you to keep tabs on each element of compliance.
For example, you might use an accounting practice management tool to set permission levels for access to sensitive documents and files, while that same platform offers an encryption technology that protects them when you need to transmit them to an external party. Take your time in choosing the right software platforms for your firm so that compliance doesn’t become an issue during the busier tax season.
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