The benefits of going paperless

The Financial Advisory and Intermediary Services (FAIS) Act has become an entrenched part of our lives. Whether we like it, or agree with it, or think it should be different, it is here in its present format and we have to comply with it. Its biggest demand on our time and the way we run our businesses, revolves around the way we deal with our clients, the advice we give to them, the reasons we give that particular advice and the ability to prove to the authorities what advice we have in fact given. The only way to achieve this, is by adequate record keeping.

A Financial Adviser is just that, an adviser, a person to whom a client or prospective client relies upon for good sound advice when it comes to the vast array of financial products available to the man in the street. It makes absolute sense, therefore, that we should keep a record of that advice. Nearly all the cases where the FSB has found against an adviser have been where inadequate records have been kept.

So we keep records. And we buy more filing cabinets, more paper, more postage stamps, rent extra space, employ extra staff (because the files need to be managed), pay to archive our files elsewhere to save space, wait for missing files to be located, recall archived files etc. As the filing cabinets increase in numbers, efficiency reduces.

 

The answer is, without a doubt the paperless office. To be completely paperless, you need to have all files, HR files, finance files, admin files, sales brochures, specimen policy wordings, proposal/application/claim forms, in fact any paper you may have in your office stored electronically.

This requires careful planning and investigation before moving ahead. In order to have a paperless office, you need to comply with a variety of legislation, and very few systems out there comply with all aspects.

 

You need to consider the requirements of the FAIS Act, the SARS Act, the Tax Administration Act and the new Companies Act. ‘The cloud’ or ‘on the web’ are fashionable buzz words at the moment. But beware, your system may not be as good as you believe it to be. In terms of Section 30(1) b of the Tax Administration Act, records retained in electronic format must be kept and maintained at a place physically located in South Africa. You can, if you have the time and your system meets their requirements, apply to a senior SARS official for authorisation to store your records outside South Africa.

It is of no use having a paperless system that is linked to your policy management software if it cannot handle HR and financial files as well. If it does not, you will not have a paperless office. You need to consider how effective the system is at retrieving documents, how easy the system is to use, what additional training your staff will need, security of the database and backups. Having decided to do away with paper files, how portable will your new electronic files be? Will you be able to take your file with you when you need to visit a client?

The biggest contributor to poor filing and record keeping is speed of filing. We are all busy and we mean to do the record keeping, but if the system is too cumbersome, we don’t do it. If records are simple and quick to produce and retrieve, filing is more likely to be efficient.