Page 16 - KFMS Your Own FD Ebook

Compliance

What is Compliance?

Generally, compliance means adhering to a rule, such as a policy, standard, specification, or law.
Regulatory compliance defines the goals companies want to achieve to ensure that they
understand and take the necessary steps to comply with policies, relevant laws, and regulations.
Thus, a simple definition could be:

“Compliance management is the process by which managers, plan, organize, control, and lead
activities that ensure compliance with laws and standards.”

Legal compliance is a mandatory.

Examples are:

• HMRC & Companies House regulations
• VAT Regulations
• Health & Safety
• Insurance (Employers Liability)
• HR (employee contracts etc.)

Corporate Governance requirements is now mandatory for larger companies

If you have entered into formal contracts with customers and suppliers, the clauses within those
contracts become legal requirements

Ever-changing regulations create uncertainty making it difficult to predict their scope and impact
on any business. Red-tape, paperwork and complex legislation can hinder your company’s plans
and it can be exceedingly difficult to move forward without taking care of compliance issues.

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