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How to effectively manage your business records using Virtual Data Rooms

by Staff Writer
21 Oct 2019 at 16:02hrs | Views
Businesses, whether big or small, need proper management to function smoothly. If you are a small business, maintaining clean business records will surely impress your customers and potential partners. There are several strategies and technologies to do this, like Virtual Data Rooms (VDR).

VDRs are online repositories of electronically-formatted business documents where authorized users can access them securely anytime and anywhere. In their early days, VDRs were mainly used by lawyers to communicate with their clients. Nowadays, they are chiefly utilized to fast track the due diligence process in business transactions like loan syndication, venture capital, private equity, and mergers and acquisitions.

Types of Business Records You Should Keep

Businesses should keep a record of all their transactions for better management and regulatory compliance. In the United States, federal and state authorities like the Internal Revenue Service and the Small Business Administration require small and medium-sized enterprises (SMEs) to maintain business records for specific periods. Here are some of them:
 - Licenses and permits
 - Legal documents like insurance agreements and contracts
 - Lease agreements if you lease your business premises and equipment
 - Employee records such as pay slip copies, timesheets, and personal information
 - Safety records like risk evaluation for occupational health and safety
 - Tax return information
 - Financial statements like balance sheets and profit and loss statement
 - Invoices for goods and services sold and purchased
 - Bank account and credit card statements

Benefits of Virtual Data Rooms
The advent of disruptive technologies like VDRs has radically changed business records management. Due to their accessibility, control, and security, corporations can keep their transaction records safely with easy access. Here are other benefits of VDRs in business, particularly for SMEs:
 - Organize and share business records quickly - If you use a VDR in record keeping, you can easily access any files you need. Accessibility of documents will facilitate your business transactions; thus, increasing your profitability. You will build better relationships with your customers and business partners. You can also monitor the people who have accessed your files and data because of the VDR's tracking mechanism.

 - Reliable data protection - VDRs use complex encryption systems to ensure the security of your data. VDR suppliers are experts in the field, so they can sufficiently protect their products against hackers and cybercriminals. Besides, cloud computing is already more secure than on-premises systems due to the expertise of the providers.

 - Simplified access control of sensitive documents
– You can effectively manage who can access your stored data in the electronically-protected VDRs. You can just set permissions based on your own rules and restrictions.

 - Faster business transactions -
Because VDRs secure your documents on the cloud, you can easily access them and share with your clients without the need for face-to-face meetings. Electronic sharing eliminates potential human error; thus, business deals can be done quickly and error-free.

 - Feedback and analytics mechanism
- VDRs have feedback mechanisms about your business dealings. With this feature, you can make the necessary adjustments to improve your procedures. Also, the analysis made by VDRs often results in new business opportunities for you.

Adopting new technologies for business may be necessary to gain a competitive advantage over competitors. By investing in new systems like VDRs, you are improving your records management practices while getting leverage against your rivals in the age of the computers.

Source - Byo24News

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