Is Your Client Data Secure?

Source: Journal of Accountancy

In this article, Joel Lanz and Nancy Cohen highlight a number of ways your firm can improve the security of your clients' data.

1. Know what types of information your firm is storing. Categorize it so you can adequately protect sensitive information.
2. Take a look at your firm's current security levels. Is your data safe from hackers? Are employees inadvertently putting client information at risk by using personal means to store data, such as a phone or a flash drive?
3. Increase your protection where it is needed. This may involve adding new policies, educating your employees, monitoring information access, or even obtaining cyber insurance.
4. Ensure that vendors and other third parties who have access to your clients' information are contractually obligated to uphold the same security standards your firm maintains.
5. Be aware of the legal requirements for data protection in your state, and in the states where your clients live. A number of data protection laws apply according to a client's state of residence.
6. Remember to make use of your shredder and data-wiping software when sensitive documents and information are no longer needed.
7. Have a plan in the unfortunate incident of a data breech, and be sure your team knows how to carry it out.

For the complete article, read “Protecting privacy.”

From Journal of Accountancy, American Institute of Certified Public Accountants, August 2012, http://www.journalofaccountancy.com/Issues/2012/Aug.