Insight

Digital documents with e-signatures aren’t going away

Have you applied for a business loan lately? Or had some repairs done on your facilities? Maybe you’ve signed a contract with a certain technologically inclined customer or vendor. In any of these instances, you (or one of your employees) probably had to electronically sign a digital document.

So, the next question is: Why isn’t your company using this technology? If the answer is, “We are,” kudos to you (assuming it’s working out). But if your reply is, “We’ve always used paper and don’t want to deal with the expense and hassle of converting to digital documentation,” you may want to reconsider — because it’s not going away.

Why go digital?

For businesses, there are generally three reasons to use digital documents with e-signatures:

1. Speed. When you can review and sign a business document electronically, it can be transmitted instantly and approved much more quickly. And this works both ways: your customers can sign contracts or submit orders for your products or services, and you can sign similar documents with vendors, partners or consultants. What used to take days or even weeks, as paper envelopes crisscrossed in the mail, now can occur in a matter of hours.

2. Security. Paper has a way of getting lost, damaged and destroyed. That’s not to say digital documents are impervious to thievery, corruption and deletion, but a trusted provider should be able to outfit you with software that not only allows you to use digital docs with e-signatures, but also keep the resulting files encrypted and safe from anyone or anything who would do them harm.

3. Service. This may be the most important reason to incorporate digital docs and e-sigs into your business. Younger generations have come of age, if not grown up, with digitized business services. They expect this functionality and may prefer a company that offers it to one that still requires them to put pen to paper.

What about the law?

Many business owners hesitate to dive into digital docs and e-sigs because of legal concerns. This is a reasonable concern. However, e-signatures are now widely used and generally considered lawful under two statutes:

  1. The Electronic Signatures in Global and National Commerce Act of 2000, a federal law, and
  2. The Uniform Electronic Transactions Act, which governs each state unless a comparable law is in place.

What’s more, every state has some sort of legislation in place legalizing e-signatures. There may be some limited exceptions in certain cases, so check with your attorney for specifics.

Is now the time?

To be clear, investing in digital documents with e-signatures, and training your employees to use them, is a major strategic initiative. You need to ensure the return on investment will be worth the effort. We can assist you in evaluating whether now’s the time to “go digital” and, if so, in setting a budget for the software purchase and implementation.

© 2020

Related Insights

Two hands arranging separate stacks of wooden blocks, representing a nonprofit merger that protects tax-exempt status with guidance from a CPA in Bel Air, MD at Weyrich, Cronin & Sorra.

Non-Profits

Restructure your nonprofit with confidence

Restructuring can help certain nonprofits reduce costs, combine resources, change their legal forms or move to another state. IRS guidance generally…
Hand holding a magnifying glass over a target with 2026 highlighted, representing year-end tax planning by Weyrich, Cronin & Sorra

Tax Prep, Planning & Strategy

5 year-end tax planning strategies for businesses

Before 2026 ends, these five year-end tax planning strategies can help your business reduce its federal income tax bill, from capital asset purchases to the QBI deduction.
Wooden model houses beside stacks of coins with dollar, percent and tax speech bubbles, representing tax planning for real estate investors with an accountant in Baltimore at Weyrich, Cronin & Sorra.

Construction, Real Estate, CIRA

Tax planning for real estate investors

Many individuals invest in real estate to help diversify their portfolio, create an income stream for themselves from rental income and build…

Connect with us

Use the form below to send us an email. WCS responds directly to all inquiries and general questions within 24 hours of posting.

This contact form is deactivated because you refused to accept Google reCaptcha service which is necessary to validate any messages sent by the form.