Data conversion services are assisting businesses in all sectors of an economy in their digital transformation and ensuring more efficiency. However, in the present digital world, digital transformation alone is not enough, it is important to be compliant. Compliance refers to the company obeying all of the legal laws and regulations with regard to how they manage the business and their staff, and their attitude towards customers. As the Code of Federal Regulations continues to grow, businesses must make sure that they are compliant with all applicable regulations, especially those related to data protection, sharing, and storage. Professional assistance may be required to ensure flawless compliance. Failure to meet compliance requirements could result in penalties for the business.
Effects of Regulatory Compliance Breach
It is difficult to measure the impact of a compliance breach. Fines are meant to be a deterrent and a punishment that can have a major impact on the business’s bottom line. In the healthcare sector, HIPAA violations can carry severe financial penalties. Category 1 violation carries a minimum of $100 up to $50,000, and Category 4 violation carries a $50,000 up to a ceiling at $1.5 million. The largest fine ever imposed for an environmental violation, i.e. $18.7 billion, was on BP for the 2010 Deepwater Horizon spill. In the post Enron era, the governments of North America and Europe have taken measures to prevent future corruption and only a thorough knowledge of all relevant regulations and penalties involved will ensure that your business is safe in the future.
Tips to Keep Your Business in Compliance
- Know your tax rules: When you run a business, there are many things you have to remember such as tax codes, rules, and regulations that are confusing. It is important to update yourself and adhere to tax codes. Tax codes non-compliance can have a negative impact on your business, and it can also put you behind bars. So it is important to understand tax codes, and be both federal- and state- compliant.
- Have a periodic compliance audit: It is important to have a periodic compliance audit within the company. Regular audits help to identify the anomalies and remain in compliance. There are many aspects in running business operations and all these areas should be in compliance. With the help of a good compliance management team, all business requirements can be satisfied and this also helps to save time and money.
- Understand human resource rules and policies: All businesses should follow necessary policies governing the human resources; and it is mandatory for businesses to have a strong and actionable sexual harassment policy. All employees must be trained, and make them sign the policy to prevent a legal action later. There are various other rules that oversee human resource policy such as work benefits compensation plan, pension policy etc.
- Educate your employees: No matter how big or small your company is, all your employees must be trained on compliance requirements. A minor mistake from any of the employees can lead you to legal troubles. Training your employees means you can escape from legal challenges easily.
- Keep your compliance documents safe: All important documents such as invoices, contracts and others related to the compliance process must be kept safely. Important data can be converted into digital format with help of data conversion services and thereby ensure no data is lost. The right data or information can exonerate you from a full-blown legal crisis.
- Create a checklist: You can learn about all the necessary requirements to maintain business compliance both on your state’s small business administration site and the United States’ Small Business Administration site. Prepare a checklist, including the timelines and the required paperwork, so that you can meet the various requirements.
- Keep virtual copies of all paperwork and receipts: Make sure that you accurately label all your digital records and stay organized. Maintain all your receipts also. The IRS typically requires only receipts for business equipment of $75 or more, but it is better to keep all the receipts to prove business expenses in case you have to face an IRS tax audit.
- Reveal any potential conflicts of interest: Partnerships, corporations, and LLCs are committed to higher standards of disclosure than sole proprietorships. Business owners must disclose potential conflicts of interest to other entities involved in running the business. Maintaining this in writing will help to have a record. Having a conflict of interest need not prevent you from engaging in a particular activity, if other state laws don’t apply.
Staying in compliance need not be viewed as something harassing and burdensome – it can be used effectively to actually help the business. You may have to compile a whole lot of information and analysis to meet regulatory needs, but it can be used to serve your own company’s purpose to refine and enhance your operations. These insights gathered can be used to design solutions for problems perceived. The technological innovations you add to help with regulatory compliance can be used to provide better business outcomes. For instance, technologies you use for regulatory data collection, maintenance and reporting can be used to improve data accuracy, and provide an improved customer experience and faster speed to market. What companies need to do is to identify how a compliance program can both preserve and create value because this will transform the compliance program into a valuable investment in your business’ future.