Compliance Management
Compliance Management is the process of ensuring the given legislation and standard of an organization. Compliance management is not a single form. Some of them are Internal and external standards, policies, third-party audits, security controls and technological enforcement. If an organization failed to comply with these laws and standards, then it would lead to loss and penalties. Many organizations are struggling to fulfil these regulatory requirements.
Risk Factor of Compliance Management
Compliance management is a part of the legal requirements. So, non-compliance can ruin the business growth and its reputation. It is punishable with imprisonment or with fine or both, even if you failed to prepare the income tax return form, financial statements. In addition to these, the following impacts will happen.
- Legal impact
- Reputation impact
- Loss of profitable opportunities
- Financial impact
The regulatory compliance varies with location as well as the industry. Additionally, there are numerous compliance and legal requirements need to be accomplished to lead a successful business. For instance, one company should comply with the following compliance in India.
- Preparation of Financial Statements, Balance Sheet, Profit & Loss Statement, Depreciation Schedule, Ledgers, Trial Balance
- Income Tax Return Form Filing
- Annual ROC Filing
- Audit Compliance
- Audit Report, Director’s Report, Internal Financial Controls Report
Internal Audit
Compliance and internal audit serve two different roles. However internal audit can monitor the compliance of an organization. Through this internal audit report, non-compliance can be identified and the same will ensures the effective functions of the compliance process. Most of the companies, especially one which is started newly do not know whether their compliance and internal audit processes are effective or not. As we discussed, an effective internal audit will be required. Because, through the effective internal audit, one can monitor the compliance.
“According to the Institute of Internal Auditors, role of internal audit is to provide independent assurance that an organizations risk management, governance, and internal control processes are operating effectively “
Corporate compliance involves a wide range of rules. Since it is a vast process, risks associated with these organizations also very high. By using effective compliance management and internal audit plans, you can reduce operational burden, meet regulatory requirements, and safeguard the organization.
Latest Technology Approach
Since compliance is more complex and challenging with the increased rules and regulations, it is difficult to eliminate all the organizational risk factors. But the high impact compliance requirements can be met without fail and other impacts will be reduced by using the latest automated system approaches. Some other benefits of the latest system approaches are,
- Reduced business risk
- Peace of mind
- Minimal effort
- Flexible
- Intelligent analytics
- Notification and alerts
- Reporting of non-compliance
Also read, Top 6 ways to save money with ITM.
