As a business manager, keeping up with compliance requirements is likely one of your least favorite activities. It is, however, one of the most critical aspects of your business’s long-term success.
Narrowing down the most important things you need to know can simplify the process. This information differs across business types, business sizes, and industries. Even so, there are some basic things you should know that holds true across most businesses.
1. Creating a Recordkeeping Compliance Checklist Is Key
The most important thing you can do is to create a list of the compliance requirements for your business. This should include applicable laws, industry standards and regulations, best practices, and other relevant guidelines.
Ensure you understand each item listed on the checklist and that all employees are aware of their duties regarding staying compliant. A checklist is critical if your concerns include FINRA capturing electronic communications recordkeeping compliance.
2. Records Must Be Retained at Varying Intervals
Once you have your checklist in hand, it is time to consider the time frames for records retention. Depending on the record type, you may need to keep them for a specific number of years or until some other event occurs.
You must also determine whether to store physical copies or use electronic document management systems. It is essential that all records are stored securely and that you properly dispose of records at the end of their shelf life.
3. Fines for Non-Compliance Can Be Severe
The fines for non-compliance may range from a simple warning letter to millions of dollars or even jail time, depending on the type of violation. Sometimes, a single mistake could cost a business its license or ability to operate.
Fines are especially heavy for cases related to SEC electronic communications and FINRA supervision of electronic communications. You must stay abreast of any changes in the law and ensure your business is always in compliance.
4. Outsourcing Recordkeeping Compliance Is an Option
If you fear making mistakes or don’t have the time or resources to devote to compliance, you may want to consider outsourcing the task. Companies specializing in recordkeeping compliance can provide specific services tailored to your business’s needs and ensure that all of your records are in order. However, this is a risky undertaking because it opens up another source of vulnerability and you lose control over your data and archiving process.
5. Compliance Requirements Are Constantly Changing
It is essential to stay informed of any changes or new developments related to recordkeeping compliance. This is especially true now that we see technological advances affecting existing regulations.
Keeping track of various updates can be difficult, but it’s essential to remain compliant and avoid costly mistakes. Read current news on recordkeeping compliance and attend webinars or other educational events to stay informed. Contact a reputable compliance firm or lawyer for advice and guidance if you have any questions.
6. Every Business Has Some Compliance Requirements
Business owners that do not operate in the financial industry or other highly regulated fields might believe compliance is not a big issue for their companies. However, this is not true. For example, the accounting and human resources departments have strict compliance requirements they need to meet. Companies must hold on to payroll records and financial statements for a predetermined period or face hefty fines. It is true that negligence may never be uncovered unless an audit takes place, but t why take the unnecessary risk?
7. Automation Can Simplify the Compliance Process
It can be challenging to keep up with FINRA electronic communications rules and the strict regulations of other governing bodies. There are software solutions already tailored around these and other guidelines so that companies can ensure compliance with the click of a button. These automated services make it easy for companies to monitor, record, and store conversations. While most only store text conversations, LeapXpert can also store rich media, such as threads, PDFs, videos, and voice conversations.
Compliance is a time-consuming and labor-intensive issue that requires dedicated resources to achieve. Failure to allocate those resources could cost managers the business itself. Managers can significantly reduce the human labor hours spent on this task by turning to third-party automated capturing and archiving solutions. LeapXpert has emerged as a trusted name in the field by spearheading innovative technology, such as full integration with Microsoft Teams. Book a demo to see what it can do for your business.
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