Regulatory reporting should be a pretty straightforward task. But transforming data from the general ledger into the primary statements can be a maze of spreadsheets that are often understood by only a few individuals. This time-consuming data jungle gives rise to potential mistakes and errors in classification with no clear audit trail.
COMPLYING WITH REGULATIONS
Change is the only true constant in life. And nowhere is this more pertinent than when it comes to regulation. A survey conducted by business consultancy BearingPoint revealed that CFOs consider the constant expansion and increasing complexity of regulations to be one of the greatest challenges they are faced with.
Since information from every area of an enterprise is brought together in its Finance Department, this is often seen as the nerve centre of the business. As in so many areas, the Finance Department has a central role to play when it comes to compliance, thanks to its controlling and reporting function. As the hub for all regulatory reporting processes, the Finance Department is expected to provide both internal and external stakeholders with relevant and accurate information while taking into account the latest regulations.
Staying abreast of and allocating internal resources to regulatory compliance matters is a challenge for all companies, but particularly so in small to medium enterprises, where resources for the implementation of regulatory changes are far more limited. As a result, recent years have seen companies adopt a more reactive, wait-and-see approach to new regulations, but this has led in turn to missed opportunities for the business and in the worst-case scenario, non-compliance within the required legal framework. A lack of awareness can quickly become a strategic business risk.
IFRS & UK GAAP REPORTING STRAIGHT OUT OF THE BOX
At some point, the decision to tackle the regulatory requirements has to be taken, but where to start? Most professional software packages include an audit report from a professional auditing company, and this will comply with proper accounting principles. Businesses can then keep their compliance risks to a minimum while also increasing the reliability and transparency of their financial statements and management reports. Greater reliability and transparency means that less time needs to be spent manipulating a data jungle of spreadsheets and trying to establish a clear audit trail. This frees-up capacity to focus on the strategic perspectives of changes to regulation.