Why Is Third-Party Compliance Management Important Especially For SMEs?

Why Is Third-Party Compliance Management Important Especially For SMEs?

The Need for Compliance

The other day I met a Company Secretary who was desperate to delink himself from his current employer and look for a ‘better’ employer. His grouch? In spite of his sincere efforts, his current employer was non-compliant on some counts. The Company Secretary feared that his reputation and employability will be destroyed.

In a recent meeting with Chartered Accountants, the PM literally warned them that they would be held responsible for transgressions of the accounts they manage. As if to prove a point, the Government has listed over 100,000 Company Directors who cannot be on the board of any company and cannot take a loan from any bank. Though many may consider these governmental actions late, they do have a long-lasting effect on the way businesses will be run in India. Unless you are foolhardy and adventurous, today, it bodes well to ensure that you follow government rules and be completely compliant.

Being Compliant is very crucial for business success.

What is Compliance?

In the case of private and public limited companies, business rules are set by the company law board. When you run a proprietorship or partnership firm, a different set of rules apply, and the state government may set these through what is called the Shop & Establishment Act. State Acts have to follow the broad guidelines established by the Government of India necessarily. The state governments also issue their instructions to cater to PF, labour, payroll and tax requirements. If your business is spread across two states, you may need to follow two sets of rules and regulations.

For any business to be well run, it is essential that you be aware of all these central and state regulations and follow them diligently. That is what compliance is all about.

How To Be Compliant?

Essentially you appoint an officer to take care of your compliance activities. This could be anybody – a Director of the company or an employee who has experience. In small businesses such as a proprietorship or partnership firms, you internal or external auditor can double up as a compliance officer. As you become larger, you will need to appoint an independent person who has the knowledge and experience on compliance issues. In many cases, a Company Secretary of a limited company handles compliance requirements. At the same time, a Company Secretary may not necessarily be aware of local requirements such as labour laws and other needs. His education, knowledge, and experience are tuned more towards meeting the company law board rules.

If you a decent sized operation and have multiple offices or productions centres, being compliant becomes a more challenging task. You may need a team of people each of who is trained and knowledgeable for a particular set of laws or rules. This is where TalentPro delivers so much value.

With experience across nearly all states in India and a dominant team of legal, finance, labour, and other experts, we ensure that you are always compliant. We keep ourselves updated all the time and our officers are trained and re-trained to understand how to implement new rules.

Visit our page on Compliance and give us a call today. We will begin with a compliance audit, bring you on the right side of the law and keep you there as your work to grow your business.

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