Sovos ETM: Record Retention – Are You Keeping the information you should for as long as you should?

Many companies file their unclaimed property reports to get them over with and don't give the data another thought. This isn't the best policy as states require you to keep certain information for a certain amount of time. Failure to keep this information can be harmful to a company that comes under audit.

What should you keep? You'll want to keep a copy of your owner data. This is the information for the unclaimed property you are reporting. You'll want to keep this in a spreadsheet, other electronic means, or in your unclaimed property reporting software. If you reported small dollar amount items in the aggregate, make sure to keep a copy of any owner detail you have on hand. This will save you from having to spend a lot of time researching information if the state contacts you about a claim for a small dollar amount.

You'll want to keep a copy of the NAUPA file you submitted to the state and the cover sheet. Keep a copy of the cancelled check that was used to pay the state or your receipt if you made an ACH payment.

Letters that have been returned as undeliverable should be filed away. You can keep a hard copy of the letter and the envelope that shows the letter was undeliverable or you can keep an image of the letter and envelope if you don't have room to store the hard copies.

Unclaimed property software makes it very easy to keep all of this information in one place. For example, UPExchange business users have the ability to store their property data indefinitely with information about when the state was paid. Our audit trail helps to show when due diligence was done and can even take you directly from a specific record to the exact letter that was generated.

How long should you keep this information? Each state lists their record retention requirements in their legislation, on their websites, and/or in their holder handbooks. The average amount of time required is 10 years. I would recommend that you keep your data for at least 10 years.