Accounting Best Practices, Fifth Edition

10–8. Extend Time Period before Computer Records Are Purged

An accounting department that relies on the data stored in its computer system to handle day-to-day transactions has a problem when those records are purged. The purging process usually occurs during the month-end or year-end closing process, typically destroying all transaction records that are more than one year old. When this happens, the accounting staff goes from having immediate access to all records via their computer terminals to having to retrieve paper documents, frequently from an off-site storage location. Clearly, this is a major reduction in the speed and efficiency of the department as it relates to the retrieval of data.

The reason why records are purged is that they take up a considerable amount of space in the hard drive storage of the computer system. By purging old records from time to time, it is possible to reduce storage requirements, which makes it unnecessary to purchase additional storage devices. The best practice advocated here is actually a set of variations on retaining some or all storage space, as noted:

• Delay purging old records. The most comprehensive way to avoid additional filing work is to extend the period before which records will be deleted. For example, an automatic purge after one year can be shifted to a purge after two years. However, this policy will greatly expand a computer system’s storage requirements, a serious consideration, especially when the purge period extends so ...