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Digitally archiving documents and records within a company is an administrative challenge. Legal requirements regarding the document itself, as well as the duration and method of archiving, must be complied with; otherwise, severe penalties may apply. Find out here how to archive your data and company documents reliably and in compliance with the law.
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As a manager, you know how important – but also how time-consuming and costly – document archiving is, both for your day-to-day operations and for tax audits conducted by the IRS. If you decide to start using electronic archiving or to switch to a new archiving system (archive migration), you should first familiarize yourself with the basics of electronic record retention. Here, we provide an overview of what matters to a business and the security, time, and organizational benefits you can gain.
In the strictest sense, archiving refers to the indefinite and unalterable preservation of archival records. In a company, archival records typically consist of documents, films, images, plans, and manuals. Samples, products, or promotional materials can also be archived. The documents you are required to archive are determined in part by the company, and in part by legal requirements that mandate the retention of various documents. You only need to keep many documents for a certain period of time and can delete them once that period has expired. In some cases, legal requirements may even require you to delete records, for example, if they involve personal data.
In a company, archiving ensures that documents are retained for an extended or indefinite period in compliance with legal requirements.
To ensure that your company meets the requirements for digital archiving and complies with legal regulations, a digital (electronic) audit-proof archiving system is the ideal solution.
The key benefits of a paperless office with electronic archiving include audit compliance, quick retrieval, and legal and operational security. The archived documents are needed solely for presentation during tax audits. You can manage the documents you need for your daily work in your enterprise content management system (ECMS). This is where the benefits of location- and time-independent collaboration and automated workflows come into play.
Your company is required to retain various documents and records. Audit-proof document storage refers to the archiving of documents that may not be altered at a later date. A PDF must be audit-proof as well as a Word document. It is essential to strictly comply with legal requirements. Key regulatory frameworks define the principles for the proper maintenance and retention of books, records, and documents in electronic form, as well as for data access (GoBD), in addition to data protection laws (GDPR and BDSG) and the Trade Secrets Act (GeschGehG). The German Federal Office for Information Security provides information in the “Archiving” section on how to archive digital documents in a way that ensures they are preserved long-term, securely, without alteration, and in a manner that allows them to be reproduced. In addition, there are industry-specific regulations that are critical for audit compliance.
To ensure that you can archive documents in compliance with the law, you need a complete understanding of the legal framework governing archiving. You must also take into account the industry-specific differences that apply to your company. As part of its general guidelines, the professional association for providers and users in the field of enterprise information management (EIM) – also known as the Voice of Information – has defined key principles for audit-proof electronic archiving that will serve as a valuable resource for you.
An overview of the VOI’s key points:
In our guide Audit-proof document archiving: a checklist, based on the VOI guidelines, you will find further information explaining audit-proof archiving.
One example of additional industry-specific requirements is the long-term archiving of technical documentation in the electrical industry, which you can read about at the German Electrical and Electronic Manufacturers' Association ZVEI. The industry guidelines specify which documents must be retained in an archive, in what format, and for how long.
If you want to implement document archiving software in your company, you should first determine exactly what you will be archiving and which documents and records need to be stored in an audit-proof manner. When it comes to document retention requirements, companies must comply with various archiving obligations, which vary depending on the industry and the size of the company. Therefore, there is no universal list of documents that all companies are required to retain, but some common characteristics can be identified.
The following, for example, must be retained:
However, many companies archive more than just the files required by law. If you use an ECM (enterprise content management) system, you can also digitally archive additional documents and quickly access all data at any time. This provides a suitable solution for storing large volumes of documents and files that you don’t want to lose and want to have readily available. In addition, you can store files in any format, and in many cases, the ECM system integrates with external systems.
Examples of advanced archiving:
The ECM system gives you quick access to the content of the documents and files you archive digitally. Since most files are fully searchable (full-text search), you'll save a lot of time and effort. If you choose a cloud solution, you don't have to worry about running out of storage space down the line, because it can be scaled up as needed.
To ensure audit-proof archiving, you must comply with various legal requirements. The GoBD (guidelines for the proper management and retention of books, records, and documents in electronic form, as well as for data access) serve as a key reference for archiving. These guidelines set forth the general principles for the retention of tax-related documents. However, they do not specify exactly which documents and records must be retained.
General requirements:
Document storage is also governed by the GoBD (see section 9): Records must be archived in an organized manner, and even though there are no standardized templates, you are required to keep your documents in a systematic order. Particularly noteworthy is the archiving of electronic documents and records, as these must be preserved in their original form. This means, for example, that you cannot print, file, and delete e-mails. Instead, you must save them in the format in which you received them.
To ensure you have a complete understanding, we recommend that you carefully review the GoBD guidelines. You can find them under “Principles for the proper management and retention of books, records, and documents in electronic form, as well as for data access (GoBD)” on the website of the German Federal Ministry of Finance.
There are retention periods for documents that must be retained, and you must comply with them. These deadlines are defined by the relevant laws: the German Commercial Code (HGB) and the German Fiscal Code are two prominent examples. However, you cannot keep all documents and records on file indefinitely. The GDPR (General Data Protection Regulation) sets the maximum duration in this case.
You can store all your files in a digital file. In addition to common formats such as text files, spreadsheets, or PDFs, you can also store graphics, images, media files, and special formats. This allows you to create an archive – that is, a manageable space – with a complete overview of your clients or projects.
6 years
10 years
You can also find additional information about retention periods on our topics page “Retaining documents: what you need to know. ”
You must adhere to specific retention periods when storing various documents. However, you cannot archive all documents and details indefinitely just to be on the safe side. Apart from the issue of storage space, certain data must be deleted after a specified period of time. The legal basis for this deadline is provided by the GDPR (General Data Protection Regulation) and the BDSG (German Federal Data Protection Act).
In companies, personal data is automatically stored along with documents that must be archived – such as correspondence that helps explain relevant documents or employee data in personnel files. On the one hand, these data are subject to special access controls; on the other hand, the personal data must be deleted once the retention period has expired. This is because the GDPR establishes the “right to be forgotten” for this data and imposes penalties for violations. To keep track of documents and files and ensure compliance with retention and deletion schedules, it is advisable to use appropriate software.
Business e-mails are also subject to the archiving requirement. Tax law, the German Commercial Code, and the GoBD specify which e-mails you are required to archive. As a general rule, you must also archive e-mails in an audit-proof manner if they are relevant to business operations or help in understanding documents that are subject to archiving requirements. They must also be archived in a complete, tamper-proof, and machine-readable format.
To give you a better idea, here are a few real-world examples:
Even though the core of archiving typically consists of accounting records and commercial documents, nearly all companies are subject to specific archiving requirements that you must comply with.
The commercial and tax regulations governing archiving are essentially the same for all companies and industries; however, when archiving, you must also take into account legal requirements from other areas of law, such as labor law, social security law, or product liability law, which results in industry-specific variations and requirements. It is not possible to provide a complete overview of the industry-specific rules for all sectors here, so we will explain the extended retention requirements mentioned using an example.
One example from the field of medicine is the patient record. Different retention periods apply here. Section 630f of the German Civil Code (BGB) stipulates a retention period of 10 years, unless another retention period applies. In the case of radiation therapy, however, the data and records must be retained for 30 years, as specified in Section 127 (Retention, Disclosure, and Transmission of Records, X-ray Images, Digital Image Data, and Other Examination Data) of the Radiation Protection Ordinance.
These two examples represent only a small part of the medical record retention requirements. For more information, please see here (German only).
On the hardware side, archiving is implemented using storage systems that a company can operate on-premises or through a cloud service provider.
In Germany, Austria, and Switzerland, different retention periods apply to documents and records. When archiving documents digitally, therefore, be sure to pay close attention to the relevant legal requirements, even if there appears to be significant overlap at first glance.
The biggest difference is the retention period for accounting records. In Germany and Switzerland, you must keep these records for 10 years, and in Austria for 7 years. There are also differences when it comes to employment-related documents, such as work records. You must keep these records for 1 year in Austria, 2 years in Germany, and 5 years in Switzerland.
Caution is therefore advised when adopting a state’s retention periods and archiving requirements, as there are significant differences – despite many overlaps – that could result in penalties. Thorough research is essential, as there are sometimes differences between individual states or cantons even within a single country.
The website of the Austrian Federal Economic Chamber provides a good overview of the relevant deadlines in Austria, specifically under “Record-keeping requirements for businesses (German only). ”
In Switzerland, you can find the key deadlines in the Swiss Code of Obligations (Commercial Accounting, German only), and in Germany, the principles governing the proper management and retention of books, records, and documents in electronic form, as well as data access (GoBD), are the primary source.
Without specialized software, it is difficult to comply with legal archiving requirements. The method of archiving (audit-proof), the minimum retention period, and data protection (GDPR) form the framework. With the right software, you can keep track of everything. When you integrate an ECM system into your business, you get more than just a simple archive: You can centrally manage information and communication within your company, thereby streamlining your internal processes.
If you want to digitally archive your documents and use a platform for internal and external data exchange, you should consider an enterprise content management system.
An ECM consolidates your information into a single system. It encompasses the management, storage, archiving, and delivery of all types of content. The enterprise content management system helps you manage your business effectively and promotes information exchange, communication, and collaboration – both internally and externally. This gives you a comprehensive overview of your data and processes. You can also use automated workflows to streamline your processes. A professional ECM system can be customized to meet your company's needs, meaning you can directly incorporate and implement your internal policies for data storage and management.
The audit-proof archiving, logging, and versioning of files is just one of the many features an ECM solution has to offer.
"Audit-proof" means that an archived document can never be altered without being noticed. The figure shows a change history in the enaio® ECM solution.
If you have an ECM or DMS system in your company, you can digitally archive incoming documents or save them directly in the customer record. You can also link the e-mails (including attachments) to the corresponding electronic client file. This way, all transaction-related information is kept in one place and can be easily found, accessed, and reviewed at any time.
When documents are stored in the ECM system, a predefined workflow for automatic deletion is triggered, which deletes the documents at the end of the retention period – in this case, 10 years from the end of the year – without any action on your part.
The ECM also allows you to define access rights for employees in groups. This ensures that only authorized employees have access to the archived files.
Since its founding in 1928, GLOBUS has grown to become one of Germany’s leading retail companies. With 18,500 employees, the family-owned company operates 55 supermarkets, 90 home improvement stores, and six electronics stores in Germany, as well as 27 full-range retailers in the Czech Republic and Russia and two home improvement stores in Luxembourg.
The company's size, extensive product portfolio, and business operations in four countries had outgrown the existing digital archiving system. To meet the demands of further expansion, a new solution for integrated information management had to be found.
Requirements
GLOBUS's goal was to implement a new information platform capable of managing and archiving millions of data records in an audit-proof and legally compliant manner. The solution had to be suitable for international use and support multiple languages. Automating workflows is intended to optimize daily work processes. Access to the archive had to be available to all locations and employees.
Implementation
Using yuuvis® RAD (Rapid Application Development), GLOBUS carried out a highly extensive data migration: The existing archive, which had reached its limits, was replaced, and GLOBUS, in collaboration with OPTIMAL SYSTEMS, decided to migrate the data in phases. While the first branches were already using yuuvis® RAD, the existing archive continued to operate in parallel until, after just six months, yuuvis® RAD was fully implemented across the entire group. Result: Using a full-text search, 200 million documents can be found in less than 3 seconds from any location.
Digital archiving should meet the following requirements:
An overview of the benefits of yuuvis® RAD for GLOBUS:
Many companies have been using a digital archiving system for years. However, the operational and regulatory demands placed on the system increase every year, and there comes a point when the existing solution reaches its limits.
There are various reasons why you might be looking for a new solution, such as:
Before you migrate your archive to a modern archive system, you should answer the following key questions:
At first glance, the difference between on-premises and cloud solutions in the context of digital archiving is straightforward for businesses. With on-premises solutions, you use and store your data locally, whereas with cloud solutions, you store your data on the cloud provider’s server (or servers) and access it via a web browser. Hybrid solutions are hybrid models in which your data and applications are stored partly on-premises (such as in a traditional data center) and partly in the cloud. As a company, you decide which areas are located where.
More specifically, cloud solutions can be classified based on how cloud providers and companies divide responsibility for operation and maintenance (IaaS, PaaS, SaaS) and whether a cloud stores data exclusively for a single company or is accessible to many customers (public or private cloud). There are various models available here, some of which can be combined. In principle, this allows for the implementation of various data protection and archiving requirements.
With a hybrid solution, for example, sensitive data can be stored on-premises and the rest in the cloud. Role and access rights can be adjusted accordingly. Cloud doesn't necessarily mean a data center, and cloud-native technology can also be operated on-premises. There are many different options available, and every business owner should find the solution that works best for them. An important step in this process is developing an archiving strategy that addresses your specific needs.
For modern archiving, switching to the cloud offers several advantages, such as:
Digital archiving (electronic archiving) is the systematic, tamper-proof, and long-term storage of documents on a digital medium. This data is often stored on a server or in the cloud.
The main advantages of digital archiving are:
Digital archiving – also known as electronic archiving – stores your data in a system designed for that purpose. Archiving software (ECM or DMS) helps you automate processes using customizable workflows. The software stores your digital data (including scanned documents) in an audit-proof manner.
Due to legal requirements regarding the archiving of documents in businesses and government agencies, invoices must be archived in an audit-proof manner. Electronic (digital) invoices can be printed out and filed in an archive or stored using specialized archiving software that ensures compliance with legal requirements. Most enterprise content management systems or document management systems offer audit-proof archiving of invoices and documents.
In Germany, the retention period for receipts and accounting records in businesses is 10 years (6 years for business correspondence). The retention period begins at the end of the respective calendar year. The German Commercial Code sets forth detailed provisions regarding all time limits in Section 257 Retention of Documents.
In the context of archiving, the term "audit-proof" refers to the proper, legally compliant, and timely archiving of business transactions and documents within a company. Legal regulations governing archiving, as well as internal company compliance policies, define the framework. The immutability of documents and files, as well as the traceability of archiving processes, are also essential components of audit-proof archiving.
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