2014 Regulatory Changes Impact SMEs

Accounting Today lists nine key regulatory changes identified by Paychex that could have a significant impact on Small Mid-Sized Enterprises (SME). 

 Many SME’s hope to fly under the radar when it comes to regulatory compliance issues. With the drive toward greater transparency and governance practices required by regulators and corporate stakeholders, SMEs must adopt better engagement strategies to incorporate regulatory mandates into the enterprise. 

Regulatory compliance initiatives need not be a check the box exercise. SME’s dedicated to a best practices regimen incorporate regulatory compliance initiatives as an opportunity to implement improvements in operational and governance practices. SME’s committed to a culture of continuous improvement use regulatory mandates to integrate requirements into sound practices as central pillars of effective governance, risk, compliance (GRC) program.

Sound practices are a set of standards and controls that mitigate numerous risk factors in the corporate enterprise. Sound practices address corporate governance, operational and market risk factors, regulatory compliance, corporate citizenship, and stakeholder communications within a set of defined expense ratios. Market leading SME’s effectively ascertain emerging regulatory initiatives to optimize operations to enhance competitive position. 

The Paychex list notes the Affordable Healthcare Act, Defence of Marriage Act, Minimum Wage legislation, Immigration and E-Verify, IRS focus on Revenue Recognition, Retirement Programs, Employment Regulations, Privacy Rights and Data Security, Mobile Technology and Bank regulations. These emerging regulatory concerns need to be thoroughly assessed to determine how they can be incorporated into the company’s business model to create a new and improved value proposition for clients, employees and stakeholders.

A STEEPLE analysis is a useful tool to determine how these emerging issues will impact the SME business model. STEEPLE is an acronym for Social, Technological, Economic, Environmental, Political, Legal and Emerging Risk factors confronting the business. A STEEPLE analysis is fully incorporated into Sum2’s S3 app.

Sound practices require that regulatory compliance programs be embraced as a brand building exercise. Corporations that approach compliance by implementing best practice solutions will mitigate reputational and regulatory risk, attract high end clientele, and command premium product margins.

Sum2 believe this to be the case as well. Our clients engage risk as a daily cost of doing business. We design risk management products for small business managers that empower them to lower the odds and consequences of damaging risk events while positioning themselves to be the beneficiaries of opportunities changing market conditions produce. 

Get risk aware and protect your business with the S3 an SME Seismograph, a risk detector and an early warning and opportunity discovery app on Google Play. 

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Get Risk Aware

Risk: regulatory, tax, emerging risk, GRC, S3, STEEPLE, AHCA, Defence of Marriage Act, Card Check, Immigration and E-Verify, Minimum Wage, Accounting Today, IRS, Paychex, STEEPLE

File an FBAR or Find Yourself Behind Bars

A few years ago the IRS offered a tax amnesty program for US citizens who failed to declare assets held in foreign bank accounts. This came on the heels of a highly publicized legal action against UBS. The IRS forced the Swiss based bank to turn over the account information of US citizens. The IRS was clamping down on tax evaders, exploiting the protection of Switzerland's bank secrecy laws to hide income and assets. The IRS was looking to determine if FBARs had been filed by the banks US citizens.

Individuals and corporations with assets greater then $10,000 held in foreign bank accounts must file a Foreign Bank Account Report (FBAR) with the IRS or face potential legal action.

UBS counted 52,000 US citizens as private banking clients. It would be safe to assume that most of those accounts had balances greater then the $10,000 declaration threshold. 

Any US investor participating in a foreign based fund partnership or investment vehicle must also file an FBAR. High Net Worth (HNW) investors and their tax advisers should conduct due diligence on private bankers and asset managers to confirm that FBARs and appropriate declarations and forms have been filed by investment partnerships and their administrators. HNW tax advisers should contact the chief compliance officer at the fund to request an attestation letter stating that the fund is in full compliance with foreign bank reporting requirements.

Bernie Madoff and Sir Allen Stanford may look good in orange prison jumpsuits but that doesn't mean it will look good on you. Don't become a slave to fashion. Get compliant. Check with your tax adviser to make sure FBARs are filed.

Get compliant and file an FBAR with Sum2's AML SAR Filing BSA Reporting App. The app is used by financial institutions, compliance professionals and industry service providers to comply with Anti-Money Laundering (AML) best practice provisions and regulations. Protect your clients and your business from money laundering risk with this critical compliance application.

Since 2002,  Sum2's AML compliance products have helped investment managers, broker dealers, MSB's, banks and credit unions comply with the AML provisions of The Patriot Act, BSA Reporting and OECD best practices. 

Get AML aware. Download AML SAR Filing / BSA Reporting App on Google Play.

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Risk: AML, FBAR, legal, compliance, tax, reputation, criminal prosecution, IRS, OECD, Patriot Act, MSB, private banking, hedge funds, CPA, UBS, Credit Unions, SAR filing, BSA Reporting