Technology: The Backbone for Regulatory Compliance

The pandemic has meant that UK businesses have been forced to furlough – or even lay off – employees in many cases. This is a sensible decision in the most part; government support through the furlough scheme has kept many companies afloat, with estimates showing that more than nine million UK employees are expected to be furloughed during the crisis.

Despite this being a lifesaver for many businesses, it can also bring a palpable loss in business expertise. With employees using the scheme unable to contribute to work in any way, what happens, for instance, if a key member of your finance team is no longer available to make their contribution? Or if someone with expert knowledge in one specific, crucial area of finance operations can’t be asked for their input?

This undoubtedly concerns treasurers, whose expertise is heavily relied upon by enterprises across the globe. Handling liquidity and mitigating operational, reputational and financial risk is no mean feat, and these employees, often with many precious years of experience and training, could currently be absent.

Businesses are strictly monitoring cash flow and all finance activity now, so without access to specialist staff to guide them through this time, it’s essential that technology services are put to good use instead.

Compliance in a remote setting

Everything is changing, including regulatory requirements. However, one thing remains: the risk of non-compliance and fines for negligence is as prominent as ever. Corporations will still be penalised for overstepping the line surrounding trading and tax laws, despite the mass confusion and upheaval of the economic landscape. This is why, when experts aren’t at hand, firms must turn to their technology investments to guide them through this complicated period.

All this is happening during a time of huge change regarding tax and VAT specifically. Along with delays and shifts to combat the current Covid-19 landscape, there is an unprecedented move towards digitisation and policy adjustments are happening globally. At the best of times, certain third parties and software solutions can make an enormous difference to tax processes but, currently, they may well be the difference between business success and failure.

Managed services for reduced capacity

For finance teams, plugging financial leaks and monitoring global legislation developments is of the utmost importance. However, treasurers are generally time-poor and often weighed down with administrative tasks, under immense pressure to keep the books balanced and constantly aiming to mitigate financial risk. Without the usual headcount on board to manage business-critical finance operations, enterprises don’t have access to the in-house expertise that has guided them through previous recessions. When it comes to international policy, teams instead will have to outsource this knowledge while resources are limited and invest in technology to streamline the process in the meantime.

Working at reduced capacity is set to be a challenge for firms globally. That said, in recent years digital transformation has swept across almost every industry, so the benefits of investment in technology and services alleviates pressure on the finance function. Partnering with external experts during this time is a great way to maintain confidence around complex compliance and reporting tasks, especially in the absence of in-house teams. Executing returns in a timely manner is still crucial to avoid unwelcome audits or hefty fines.

Collaboration is key

Under the current climate, and in view of the continued economic strain ahead of us, it’s vital that firms collaborate and form a network of expertise. Ongoing collaboration can be especially important, as tech intended for tax and regulatory analysis, for example, isn’t a simple ‘out-of-the-box’ solution. Guidance from experts throughout service delivery of any cloud-driven tool is essential to make the most of the features and to ensure correct use. Stretched finance departments, under the false impression that the transition involves hours of training and onboarding on complicated platforms, might shy away from investment in technology. However, software-as-a-service (SaaS) offerings are created to support and guide treasury functions under pressure to stay focused on the shifting regulatory landscape.

Keeping abreast of shifting global policies is no longer a manual job, given the swathes of data generated by every transaction. Tasks related to compliance and delivery of tax returns must continue to be handled by experts, despite lockdown measures. With this in mind, partnering with the right teams and technology throughout this period will prove to be an investment with far-reaching future benefits.