In today’s digital world, data is your most critical asset, and, as such, requires utmost protection from both natural and man-made disasters. This especially holds true for financial data, the blood life of your business. And you cannot do it properly without a disaster recovery plan.
Having a disaster recovery plan is crucial for accounting and finance
Disasters can range from a simple power outage to a once-in-a-century pandemic. But they all can cause disruption in your daily operations and, as a result, data loss.
Accounting and finance undoubtedly are two of the most critical departments of your business. Any disruption in these functions can create untold damages.
To safeguard your valuable financial data, you need a detailed disaster recovery plan. The plan can be designed specifically for the protection of information technology assets or include the wider network of other operational areas within the business.
The ultimate goal of a disaster recovery plan, as we have mentioned in previous articles, is to empower businesses to react swiftly and efficiently and to inform staff well in advance.
Steps to implement a disaster recovery plan
It is important to note that the responses vary largely on each disaster scenario, and no emergencies are identical. There are no guarantee businesses can predict with a complete accuracy an event might occur, nor one particular plan may have the capability to address every circumstance.
Thus, the information given in this article is intended to serve as guidelines only and may not be applicable for all cases. Please execute with consideration and conduct frequent review where necessary.
1. Establish a response team
Every disaster recovery plan requires a committee to plan, execute, review, and update it to ensure its effectiveness. Similarly, with the disaster recovery plan for accounting and finance teams, there should be an established Response Team enlists individuals who are:
- Best suited to handle various aspects of an incident
- The first, second, third point of contact and so on in case of an emergency
- In addition to names and contact details of designated individuals, there should be a list of activities to do if the disaster occurs.
2. Define the level of severity
A disaster undoubtedly will cause disruptions to your daily operations. One way to measure the level of impact is to estimate how long your functions may be "out of business."
- Less than 48 hours: A mild emergency that affects a large number of people but is resolvable within a short amount of time, such as power outage, fire, building facility failure, etc.
- 1 to 2 weeks: The company may still have partial access to its facility and/ or IT systems. The disaster may occur on a regional scale that requires a portion of staff to work from home or some functions to move off-site, such as weather-related incidents, contagious diseases, etc.
- More than 2 weeks: A complete loss of access to the facility and/ or IT systems, plus a large scale of working from home and operations are expected to take longer than 2 weeks to resume.
3. Deploy mitigation methods
The disaster recovery plan is not solely the responsibility of the IT department as technologies may not be the only assets that get destroyed. Your team needs to collaborate with IT to come up with potential resolutions to minimise, lessen, or prevent disruptions before they even befall.
Besides, to be considered effective, disaster mitigation is an ongoing effort, which requires continuous improvements, proactive and frequent re-evaluation. Only by ensuring every step of the strategy and every contact detail stays relevant and updated will you be able to return to work as fast as possible, with little interruptions as possible, and as cost-effective as possible.
What to do post-disaster?
Ensure the safety of your staff
After the storm has passed, the number one priority is the safety of your employees. Make sure your team members are safe and whether they are affected by the incident, can they return to work and when they can do so.
Undertake damage assessment
All damages result in monetary loss, not just the loss of data. After a careful examination of the disaster site, quickly estimate the cost of replacements for damaged equipment. Make sure you also include photos of the damage for insurance purposes where possible.
1. Damaged hard copies of documents
Despite your hardest effort in going paperless, there might still be trails of contracts, financial reports, or receipts, which cannot be re-created electronically. In case the disaster occurs, quickly identify these vital hard copies and immediately execute corrective measures to minimise any potential consequences.
You can also take this opportunity to develop a strategy to completely digitalise the document management process by leveraging readily available solutions today, namely scanning and storing files in the cloud.
2. Damaged digital copies of documents
If your team stores data digitally, you should always have data backed up regularly. Post-disaster, come up with a list of surviving files data that can be recovered and any backup files you may have.
The assessment for your digital assets can be quite extensive as it may encompass a multitude of issues, ranging from local hardware disruptions to limitation with the data storage, lack of intermittent backup procedures, or failure to test and restore backup data.
Contact your insurance company
A suitable catastrophe insurance scheme can help to protect your business and lessen the impacts of a disaster. That is why the damage assessment is critical, and thus, must be carried out with utmost diligence.
If you do purchase insurance, do not attempt to clean up the disaster site before contacting your insurer. It is best to get in touch with them within two days following a disaster to discuss your claim process, the level of damage, and how much can be covered by the insurance.
Incorporate cloud solutions in your disaster recovery plan
Data backup using cloud-based solutions adds an extra layer of protection to your sensitive financial data. What's more, data stored virtually can be instantly retrieved, which result in much lower downtime and costs.
Data storage is not the only advantage of cloud computing. A wide array of cloud solutions today, such as cloud accounting software, collaboration and communication platforms, expense management and many more, are both user-friendly and easily accessible via any device, not just your traditional workstation.
Thus, your workflows remain undisturbed, and in some cases, speed up your performance as cloud solutions are also capable of automating labour-intensive tasks.
A big plus for leveraging the cloud is its highly secure and flexible structure that can be scaled up or down, add or remove users, or install add-ons on demand.
The cloud brings endless possibilities and adds coverage to your valuable financial data. Having said that, the process of selecting the most suitable cloud services and vendors require careful examination and evaluation.
To learn more about different cloud services, what are they capable of, and popular cloud service providers. check out our resource hub or check out our latest whitepaper below.