Challenges | ComplianceMantra

FACTS :

Each organization has to comply with various statutory as well as internal compliances while performing their business related activities
- These are generally in the field of Taxation like income tax, Service Tax, Excise etc., Labor related like P.F., ESI, Factories Act etc., Legal matters, Company Law matters, and so on.
- Each area of operation has multiple Acts and Regulations to comply to like filing of returns, payments etc.
- These Acts and Regulations specify multiple tasks to be performed by the department and organization.
- If you total up all these compliance requirements under various acts, regulations, and policies for these fields that the company has to adhere, there shall be roughly 500+ compliances for each company.
- In addition, there are a huge number of internal compliances, either due to certain certifications, like ISO, CMM, etc. that an organization prefers. Or there are internal policies and management reporting system, which each department or the employees need to timely prepare and submit.
Multiple people / department are responsible for it : Since there are multiple Acts and Regulations applicable on any organization, many departments and teams work toward meeting and executing them in their true spirit.
Multiple companies and multi-location : In case the business spans across multiple companies, the total number of compliances increases exponentially. The problem becomes more complex if these companies operate across multiple geographical locations, making the total number of compliances running into tens of thousands.

CHALLENGES :

Possibility of skipping a compliance / Skipping the due date or for a particular month or period
- Each area of operation has multiple Acts and Regulations to comply to like filing of returns, payments etc.
  - Skipping a particular compliance altogether – not knowing if the regulation / compliance is applicable for the business and/or the geo-location
  - Skipping a compliance to be submitted for a specific period / month
  - Delay in adhering the compliance at a particular due date
- The reasons of missing a compliance could be many, though primarily
  - Focus is on Business operations
  - High number of compliances spread across multi-locations and multi-people having their own inconsistent practices
- The reasons of missing a compliance could be many, though primarily
The responsibility of ensuring the compliance of various statutory laws lies solely with the management. It has to be done timely and meticulously. And as it exists under most of the laws, the top executives, the heads, and the directors are held responsible for any non-compliance or delay.
Even a minor violation and unintentional delay in complying with these statutory requirements not only result in levy of damage and penalties but also prosecutions that too of the top executives whether he or she is responsible or not.

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