Running a small business is not the easiest task, and there are several aspects to consider, especially with constrained resources. However, there’s one aspect that cannot be compromised with – regulatory compliance. A company must adhere to federal, state, and local laws, regulations, norms, and practices that are applicable to the niche and industry. In simple words, regulatory compliance is all about being compliant with these regulations. These regulations are applicable for small and large companies alike, and therefore, the size of your business doesn’t give you the freedom to flunk the norms. Here’s more on what small business owners should know.
What are the different regulatory compliance needs?
It depends on the nature of your business. To be fair, regulatory compliance can be about financial reporting, or keeping up with the requirements of various agencies, such as SEC, IRS, EPA. Every business must know the need and extent of compliance, and being compliant is not a choice. If you don’t understand regulatory compliance, it is necessary to seek expertise and advice. Failure in compliance may lead to serious consequences, including fines, lawsuits, penalties, and even license revocation in some cases. Repeated offenders may have to deal with more, and in some cases, stakeholders can be considered responsible for not being compliant.
Types of regulatory compliance audits
Whether a company has been compliant to the required regulations is done through a regulatory compliance audit. The auditing team checks for possible lapses and if all dos and don’ts have been followed, based on which they give a report. There are two types of regulatory compliance audits. The first one is often a compulsory one and is initiated by regulatory agencies that are entrusted for checking compliance aspects. The second one is a discretionary audit, where you can choose to hire an independent financial company to check every aspect. They will not only identify compliance issues but will also correct the same, so that any possible consequence can be averted.
With regulatory compliance audits done by an experienced financial firm, you can expect to get assistance on establishing controls, so that regulations are followed to the T. This may refer to internal controls that checks for compliance issues before they arise, while operational and IT compliance ensures that reporting is done smoothly without any lapses.
To know more on regulatory compliance, check online now and find a company that can help with audits and more.