Dealing with International Regulatory Compliance

RSM asked the mid-market in the UK how the challenges of dealing with international regulatory compliance were affecting them and what solutions they had come up with. 

We surveyed 100 group controllers, Finance Directors and Heads of Tax in UK based businesses, with a turnover above £50m and a footprint in at least six European jurisdictions. This was followed by 20 in-depth interviews.  Here is a snapshot of the results.

What matters most to mid-market companies in managing their international regulatory compliance? 

 
 International regulatory compliance

How significant are the risks and challenges surrounding the management of international regulatory compliance responsibilities?

 International regulatory compliance risks and challenges

How ready are mid-market clients to meet their international compliance responsibilities?

94 percent of respondents were broadly on top of their current regulatory obligations but 36 per cent were ‘not’ or ‘not particularly’ ready to meet their regulatory obligations in the next two to three years due to increasing complexity. 80 per cent of respondents expected their tax risk profile to increase.

What are the particular challenges for mid-market businesses?

The same challenges face the FTSE 150 as the mid-market in terms of regulatory compliance, cultural and economic pressures. But mid-market businesses have fewer resources at their disposal compared to large publicly quoted companies giving them a competitive disadvantage and information confidentiality and data attacks are a big concern for mid-market .

 How are mid-market organisations meeting these challenges? 

63 per cent of respondents were looking to move to a more globally centralised finance function. 61 per cent were looking into to a single accounting platform worldwide, using automated compliance tools where necessary. 

Outsourcing with a trusted partner appealed to most respondents as a means of helping deliver their international regulatory compliance obligations and keep up to date with local domain knowledge, but confidentiality and control were key concerns when outsourcing. 

Ian Sadler, Partner, RSM Global Compliance and Reporting Services

 'Mid-market companies are facing many challenges in managing their international regulatory compliance across several jurisdictions and they expect it to get ever more complicated. They often feel at a disadvantage with regards to the FTSE 150 as they don’t have equal resources to draw on. However, by partnering closely with external suppliers to enhance their international footprint and domain knowledge there is no reason that UK mid-market companies cannot continue to operate, compete and expand overseas.'

For further details on the results of our survey or to find out how RSM can help with your outsourcing needs please contact Ian Sadler.