Regulatory compliance
Regulatory compliance is an organization's ability to adhere to the rules, regulations, guidelines and laws relevant to the disclosure of its business, finances, operations and performance to stakeholders and regulatory authorities. Violations, materials misstatements and material weaknesses can result in punishment including fines and imprisonment, not to mention, a complete loss of public confidence.
Corporations aspire to meet all compliance regulations even in the face of increasingly stringent rules. With these new requirements coming down the regulatory pipeline, companies are required to adopt new financial reporting techniques, calculations and strive to harmonize their financials and compliance controls.
Examples of regulatory compliance rules include:
- The Dodd Frank Act
- The Sarbanes-Oxley Act
- Federal Information Security Management Act
- Examples of major regulatory authorities include:
- USA: Securities & Exchange Commission (SEC)
- EU: European Banking Authority (EBA)