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ACCOUNTS WORKING PAPERS

How long do you keep....

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To all those old-fashioned folk who still maintain hard copy files of accounts working papers....how many year's worth do you keep (and not shred)?

We're looking to jettison a good proportion of our files, with the aim of being paperless (at some point soon).

Thanks.   

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By Mr_awol
05th Feb 2020 16:17

Depends.

Farmers, or clients with huge asset registers or investment properties, pretty much indefinitely. Management consultants, six years. You need to consider the likelihood of something on that file being important in future.

Having said that, with electronic storage we currently keep everything indefinitely - but will cull it periodically for dissolved companies, etc. Ex clients also need to be managed properly if adopting an otherwise indefinite storage policy.

It could also depend what kind of info you generally keep on the file. If you make sure it only contains important stuff (or that only important stuff is archived/scanned/etc) then it's not too much of a problem generally. If, for example, you habitually copy a whole year's detailed wages records or other third party personal data then you might need to consider whether this affects your archiving/storage policy.

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Replying to Mr_awol:
Maytuna
By DJKL
05th Feb 2020 16:48

Agreed- my previous employers, who were the accountants for my current employers before I took the position, very kindly let me have all their old files/working papers etc a number of years after I started here.

These , over the years have been very helpful, for example they have copies of professional valuations going back to the 1970s re properties we still own, copy rollover calculations etc, in fact as part of an exercise calculating latent CGT on assets in our partnership I was skimming through them just last week (over twenty years since I started here)

However we have a 2,000 sq ft office, we have two rooms just for archive storage and on a good day there are only four of us in the office, so storage space is not a consideration. (I have even kept purchase invoices/CIS records re capital improvements to the properties right back over the twenty years I have been here, if we ever sell some of our properties then, if push comes to shove we can vouch all enhancement expenditure)

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By bernard michael
06th Feb 2020 10:37

I've just moved offices and have destroyed 15 large boxes containing client 's files The worse one, which escaped previously cullings was dated 1989

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By Truthsayer
06th Feb 2020 14:18

I keep them for 7-10 years after the client leaves. Before destroying older stuff I review it for anything that might conceivably be needed in the future. For current clients I keep everything, however old. I work from home and have a spare shed that provides the archive space.

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By lh3f9764bg1g
07th Feb 2020 10:14

That's exactly my routine too.

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By pauljohnston
07th Feb 2020 11:09

If one electronically stores documents it is very easy to hold on for too long. But with CGT records it appears that they should be kept until sale of the artical or property.

Up to know we have carried out a cull on all clients that have left after 7 years, the remainder we keep electronically. Paper records fade.

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By Brend201
07th Feb 2020 15:03

Some organisations have a rigorous file weeding schedule and process - and it is not necessarily a good or bad thing.

There was one famous example in Ireland some years ago. A State tribunal (in Ireland) investigating corruption in the planning process heard from a star witness that a politician had asked for a payment to be made to a bank account in Australia. The politician had given him a sheet of headed paper from the bank with account details on it. He had retained that and had sent a large payment to it.

The politician died before the matter came to light but his family claimed for a long time that he was honest and did not have any such account. The tribunal made contact with the bank and the bank was only able to state that there had been an account with that number in the man's name but that it had been closed some years before - and that all transaction records relating to it had been shredded seven years later. Thus the trail went cold as it was not possible to say how much money had gone into it or what had happened to the money when it left the account. No further work required by the bank.

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By CardiffAccountant
08th Feb 2020 06:20

I made the decision to go paperless about three years ago.

Once all existing records were scanned (everything in the file), I simply continued to scan paper (letters, meeting notes and such like).

I index each file in date order, and delete ‘basic’ files (a sole trader with straightforward self assessment, that type of thing) after seven years.

Every February/March, a ‘quick’ review of the files takes place, and old, redundant ‘stuff’ is deleted.

We are mindful of GDPR, and wish to be seen to be adhering to it.

All files are automatically backed to the cloud and also backed to a local external storage device - can’t be too careful.

Now we have a full and complete set of client files with no worries about storage issues.

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By Moo
10th Feb 2020 15:49

What about GDPR? There's an argument that where personal data is concerned (eg personal tax clients) paperwork should be destroyed when client leaves unless you think it might be needed to defend court action or a tax enquiry.
I had a clear out with my own old clients last year and shredded all the past clients but with current clients I have records going back well over 10 years and am always conscious that the tax man could try and go back 20 years.

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