Any type of audit, be it financial, legal or tax, requires careful monitoring of its functionality. Experienced companies understand this, but it’s not always as easy as it sounds, because, during audits, organizations must share their sensitive data with outsiders. In order to make the process as secure as possible, organizations need to ensure that only authorized individuals have access to these documents and only for the duration of the audit. Fortunately, virtual data rooms can help them do just that, and in this article, we know exactly how.
Audit – traditional or electronic?
In this digital age, there are still companies that keep their records in physical form. Accordingly, they also prefer to conduct their auditing process in traditional form, inviting experts into physical stores to examine the data. This gives them a sense of control since they can observe live what’s going on and all the documents remain in place. But given technological advances, this method is extremely uneconomical, both in terms of time and money, and not particularly safe.
Companies that have realized the advantage of online collaboration use email or FTP servers to transfer their data, but even this method is not the most efficient or secure. Security flaws or the chance of human error can be fatal if your document transmission platform is not secure enough. What is left to do in that case? Fortunately, there is a solution that can solve these problems, namely virtual data room.
Virtual data room – what is it?
A virtual data room is an online tool with which, you can securely store and share sensitive information in real-time. VDRs were created for complex operations such as due diligence or audits and help greatly improve and speed up the process. It can meet the primary needs of its clients to be in control of the audit process at all times while allowing each party to remain in their own office.
VDR provides easy access for authorized users, doesn’t require complex software to set up, and doesn’t require any special knowledge of the IT industry. The data room supports any device from anywhere with Internet access.
Benefits of VDRs during the audit process
For companies that give outsiders access to their sensitive data, the security features of their software are very important. Data Room, on the other hand, is considered one of the most secure file-sharing platforms available today. It uses state-of-the-art encryption methods and a very useful detailed permissions feature. So, you can arrange group or individual permissions for each document and restrict data from users who have nothing to do with it. This can make documents more private and less visible, and human error is less of a concern since even if someone accidentally sends a file to the wrong user, they won’t see it. You can also assign different permissions to different users depending on their roles. For example, you can allow and disallow copying, printing, editing, forwarding, and downloading the document, which is great for protecting against data leakage, especially when combined with a watermark.
The monitoring features and audit trail allow you to see the actions of all users in the space down to the smallest detail, and with automatic reports, you can analyze those actions and figure out where to fix a bug or which users are acting suspiciously.