Any business aiming to operate legally must prioritize financial compliance. Regarding business finances, understanding what it means to be financially compliant is essential to running your business effectively.
We use this article to explain what it means to be financially compliant, why it’s crucial for all financial entities and companies, and how to ensure financial compliance services in your business.
What Is Financial Compliance?
Financial compliance involves the enforcement of regulations of financial laws and rules surrounding capital markets and, recently, companies. When managed correctly, it is a powerful tool for aiding crisis management.
Why Is It Important In Business?
Financial compliance exists for several reasons, the central one being to effectively assess and manage risks, including legal security, earnings, and online reputation. Nowadays, legal security is essential with companies conducting large portions of business online and storing data digitally.
Due to this digitization, things have become risky regarding data breaches by cybercriminals. The protection of earnings involves business income and cash flow management, which directly affects customer acquisitions.
Lastly, corporate brand image leans on regulatory compliance to uphold its reputation and authority.
Who Ensures Financial Compliance In Canada?
In Canada, the FCAC (Financial Consumer Agency of Canada) monitors and enforces the compliance of banks, financial entities, and businesses with consumer protection regulations.
How To Ensure Financial Compliance
To ensure that your company remains financially compliant and free of money laundering, fraud, and tax evasion, you should take the following measures:
- Implement Training – We recommend informing and training staff members regarding the rules and regulations, as many breaches occur on an individual basis.
- Hire Wisely – Ensure all staff hired have a background of adhering to compliance and be sure to query them regarding their knowledge on the matter.
- Conduct Audits – Examine all transactions and finances regularly to aid in improved overseeing any signs of non-compliance and enhance the ability to eradicate any areas of weakness.
What Does Financial Compliance Look Like?
For further reference, here are some examples of financially compliant behaviour:
- Staying updated regarding any regulatory changes as they happen to support positive decision-making within the business or organization.
- Removing those who repeat non-compliant behaviour as they pose a significant risk to the overall financial stability of a company.
- Using external expertise to check trades and ensure that everything operates under the legal umbrella.
Financial compliance is crucial for all businesses and organizations aiming to operate legally regarding finances and trade. Kevin Martin Accounting in Halifax can assist you with financial compliance services today, promising to help you ensure that you adhere to all legal protocols.
For more information on how we can help, get in touch today.