A Silicon Valley small business which transacts business electronically whenever possible, receives invoices, statements and correspondence on paper as well as electronically. All documents that arrive on paper are scanned and all emails and web pages that relate to financial transactions are converted to PDF files and stored in shared folders, organized by vendor on the file server. QuickBooks and TurboTax are used for accounting and tax preparation. Reports are generated in QuickBooks to provide financial information about the business. Reports from QuickBooks also provide input for year tax returns. These reports are stored as PDF files.
In August of 2005, the business received a letter from the IRS informing them that they were being audited for the year of 2003 in several specific areas including utility bill payments and the cost of goods sold. The business owner printed all of the relevant documents for the audit which had been stored on the Windows 2003 Small Business Server.
The business owner was able to provide hardcopy evidence to the auditor and refer to all documents on his laptop computer. All of the documentation was accepted and the audit meeting with the IRS was completed in less than an hour.
To learn about the paperless document management system please contact us.