Director of Company Secretarial, Matthew Eckford is speaking at the Going Global conference on 14 May about reducing risks and controlling costs of international operations. Here, he looks at the common scenario businesses find themselves experiencing as they establish companies and branches in new markets.
So your business is a success, you've grown exponentially. And you're keeping your eye firmly on the prize of increasing market share in the territories you've moved in to.
But increasing alongside your business wins are your compliance obligations and paperwork requirements, with serious ramifications for late filings hanging over your head.
It's an all-too-common situation as countries worldwide enact increasingly complex regulatory and tax legislation, and sharpen their focus on multinationals that appear to be avoiding tax.
Companies also find themselves faced with increased administrative pressures due to a lack of central coordination, particularly as smaller, foreign arms of the business organically become siloed as they develop and adapt to their own unique reporting needs.
As a result, your company headquarters may find it can't provide confident assurance of compliance in all of its operational jurisdictions. There is often a serious lack of investment in back office monitoring, and reporting failures can easily fall through the cracks and remain there unidentified, until your businesses is shouldered with hefty fines.
Taking a localised approach to legal entity management is necessary in order to ensure your overseas entities are operating well within the scope of applicable laws. But it's still important to see processes gel with central operations to avoid costly data inaccuracies, miscommunication of legislative changes globally and the resulting reputational risk.
There is a third avenue to successfully negotiate the blind spots in your expanding operations, and that is by using outsourced business services. Enlisting experts with a worldwide approach but a honed understanding of Corporate Secretarial, Accounting and HR processes in individual markets reduces the time spent in-house on administration across your business, enabling you to focus internal resources on your core activities.
Current records are located and checked, and an analysis produced to identify areas of non-compliance. A plan is then agreed and implemented to rectify any issues and maintain the entities going forward.
Your reporting becomes more accurate and independent, meeting the ever-growing demand for transparency and greatly reducing the risk of oversights, which saves your company money on penalties and interest payments.
Register for Matthew's Going Global talk at 2.45pm on 14 May.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
