Many law firms and accounting firms are still spending thousands of dollars on closed file storage. Some firms literally have tens of thousands of bankers boxes of closed client files in warehouses, basements, storage buildings, office space and garages. We are asked many times how long do we have to keep the closed files.
The best place for the answer on file retention will reside with your local and state bar or accounting associations as every state has different requirements.
Many firms are still generating more paper files that have to be stored. Whether they are worried about the costs of converting to a paperless system or just like the feel of paper the storage of these paper files is costly and continues to grow. Some firms argue that digital records cannot be trusted because they can more easily be deleted or destroyed. Whatever the excused used it is time to look at paperless options for many reasons:
1. Cost of storage-computer hard drives cost a few hundred dollars vs a warehouse costing many thousands of dollars a month
2. Access of old client matters-keeping track of where old paper files are stored and retrieving them can be a major undertaking occupying staff and taking many hours to retrieve. It can be literally days before and old file is retrieved. This is versus a computer system that retrieves client matters in literally seconds.
3. Misfiled client files-It happens at every firm, the client file was misfiled. The manual index points to a box, but the client file is not in the box.
4. Oops files-Sometimes when an old or current matter is being retrieved, many people may be involved that may or may not be communicating with each other. Kind of like a library book, the next person in line needs to wait until it is returned to see the file.
5. Backup and recovery-If your storage facility has a fire, theft or flood, how are the files going to be restored. Again computer files can and should be backed up.
6. File Retention-it is much easier and simpler to properly inforce a file retention policy with electronic systems
So what methods can be used to convert to a paperless system:
1. Get a staff of college students and can every document from the beginning of time into an online system. The costs to this can be enormous and could take many years to accomplish. Whether you wait until the scanning job is finished to implement or implement a paperless system immediately, chances are this project will never be completed.
2. The other alternative is to pick a point in time where all files are now stored electronically. True you need to navigate between paper and electronic files, but as time goes by more and more of the files will be electronic. This can be implemented quickly and start to reduce storage and paper costs almost immediately.
Given today’s technology, there is no excuse for a law firm or accounting firm to be using and relying on paper files.