The process begins with collection of prospects

The process begins with collection of prospects including tax information, business
transactions, receipts or customer data and more. Good record management practices
can keep your business information safe, orderly, and secure. However, improper
records management has very negative effects, both legally and for the well-being of
the organization. As a result, this can lead business down the road to potentially
crippling consequences.
Efficiency and Productivity
Bad records management results in spending too much time in locating misplaced
files. Records that not filed in any particular order can be difficult to locate when
needed and misplacing important files and documents can incur losses in terms of
expending resources in searching for these files. Thus, can take up valuable work
time when a quick and simple retrieval process of your much-needed documents can
be done. Although, records may stay stored without ever leaving their filing cabinet,
others are important and need to be accessible. For example, if an organization gets
audited, they will need to be able to easily retrieve all tax records and information to
show proofs of transactions. Without proper management, it is impossible not only to
store the records accordingly but also to find them. Hence, causing problem again on
retrieval and efficiency of business. Furthermore, the office space that is crowded
with filing cabinets causing employee morale low because they need to compete with
paperwork for workspace. Hence, efficiency and productivity of employees as well as
management to be low.

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Loss of Credibility
If you are not able to provide documentation for your organization’s management
or shareholders because you have lost it, you may lose credibility and trust . A
worst-case scenario would be the loss of one position, but even a minor loss of respect
can erode the relationship with shareholders. In contrast, if you have your documents
stored safely on a cloud-based system, you can share them with appropriate
shareholders immediately upon request and increase your credibility. On the other
hand, customer satisfaction will also be jeopardized if you cannot access
information promptly and meet customer needs. Thus, making organization’s
reputation with a client or customer has suffered as a result of not being able to locate
records. Hence, the credibility of a business can be questionable.
Failure of Compliance
Poor records management exposes organization to legal consequences , due to
non-compliance with Malaysian law and regulations on records management. There
are many pieces of regulation regarding records management; for example, the
Income Tax Act 1967 Section 82 requires every companies in Malaysia to keep
proper documentations as well as give receipts. According to the Companies Act
(Malaysia), the directors and managers of every company are responsible to ensure
that accounting and other relevant records relating to the transactions and financial
position of the company are properly kept for seven years after the completion of the
transactions or operations. A proper record can also help a company that ends up in
court as it can show conformity to statutory requirements, provide proof of
transactions, and offer protection against unauthorized access. Even if you don’t
suffer from a security breach, fail to follow proper regulations and track your
information carefully may put you in a tricky situation. Therefore, a lawsuit or audit