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4 essential RIM practices to prepare for mergers and acquisitions

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Records management teams have a key role to play in mergers, acquisitions and divestitures. Whether big or small, the sale of any corporate asset must be supported by accurate and complete records. These provide buyers with historical information, compliance documentation and other crucial records. Most importantly, complete and accurate records help demonstrate the full value of your assets.

These four RIM best practices will help you prepare for the next merger or acquisition.

Functional classification systems

Implementing a comprehensive records and information management program requires a common way of naming things: a functional classification system.

When assets are sold, this critical piece of your RIM program helps ensure the clear identification of information in both electronic and physical formats. The classification system also provides the basis for compliance, risk management, retention periods, security safeguards and other related issues that may be factors in the sale of a corporate asset.

Information that goes missing due to incorrect classification can have severe consequences: it can reduce the value of the asset, impede negotiations or introduce post-sale legal risks. That’s why a functional classification system is essential part of to being able to retrieve all of the necessary records associated with the sale of a corporate asset.

Retention schedules

While developing a comprehensive retention program is a great way to reduce storage costs and generally improve access to information, it is especially beneficial at the time of an asset sale.

With a properly functioning records retention schedule, organizations are able to quickly locate the right supporting documentation about an asset, and provide potential buyers with the information they need. Nothing slows down the critical timing of a divestiture like a cumbersome process of wading through unnecessary or inactive records. By eliminating non-essential documents—both paper and electronic—a retention schedule ensures you can retrieve the right records quickly.

Structured metadata

In conjunction with a functional classification system, structured metadata can streamline the retrieval of the right records related to an asset being put up for sale. It also allows for improved search functionality within an electronic data room—a user-friendly digital environment where potential buyers get equal access to examine supporting documentation. Metadata enables users to search with a range of terms and keywords, including records classification categories, document types, so information can be located quickly.

Optical character recognition (OCR)

Metadata is one way to improve the search and retrieval of electronic documents, but scanned or imaged documents in .pdf, .jpeg or .txt formats are not compatible with standard Text Search functionalities. OCR provides another efficient way to find the data you need, by extracting text from a wide-range of electronic records formats and storing that metadata directly in a database.

OCR is an important tool for creating an electronic data room, because it provides a simple way for users to search through physical records that have been imaged. Instead of potential buyers having to read through hundreds of physical records, OCR allows them to search through these imaged documents in seconds, just based on a variety of metadata to locate specific records and data. This ultimately paves the way to a faster, less onerous transaction.

Records management for a smoother M&A process

Normal due diligence by potential buyers does not have to disrupt the progress of finalizing a deal. Through the effective application of RIM practices, all of the correct records can be retrieved and organized, and presented to buyers in a way that makes it easy for them to find the details they need.

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