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Total Compliance Solutions
Role of Professionals
Pavan Kumar Vijay
In providing
By
A famous quote…A famous quote…
Every RIGHT implies a RESPONSIBILITY;
Every OPPORTUNITY, an OBLIGATION;
Every POSSESSION, a DUTY.
- John D Rockefeller Jr. - John D Rockefeller Jr.
RESPONSIBILITYRESPONSIBILITY
OBLIGATIONOBLIGATION
DUTYDUTY
Compliance of Rules,
Regulations &
Laws of the Land
CORRESPONDS TO
Compliance of Rules, Regulations & Laws of the
Land
Good Corporate Governance
Management Perception Management Perception
Most of us can read the writing on the wall; We just assume it’s
addressed to someone else.
- Ivern Ball
Role of Professionals Role of Professionals
TO TO CHANGECHANGE
THE THE MINDSETMINDSET
To let management To let management understandunderstand
Outstanding Performance, Higher Profits,
Expanded Market Reach and the like FAILS
to protect a company which has put good governance &
ethics at the back burner…
Example – ENRON, WORLDCOM, ADELPHIA, TYCO
…Only the culture of Strict adherence to Good
Governance can keep a company
Ahead on sustainable basis
Example – INFOSYS, MICROSOFT, RANBAXY, DABUR
Transformation of INDIVIDUALITY to PERSONALITY
Through PSYCHO-SOCIAL Evolution
“Tasmat Yogi Bhav, O Arjuna”
“Tasmat Yogi Bhav, O Arjuna”
Professional’s role to show the right way
Management deliberation/confusion
on right & wrong
To made management To made management realize realize
GOOD GOOD GOVERNANCEGOVERNANCE
is the process is the process
to convert to convert
Your Your CUSTOMER CUSTOMER
into into
Your Your SALES PERSONSALES PERSON
Designing Designing effective & user friendly effective & user friendly
COMPLIANCE MANAGEMENT COMPLIANCE MANAGEMENT SYSTEMSYSTEM
to lay down strong to lay down strong foundation for foundation for GOOD GOOD
GOVERNANCEGOVERNANCE
IMPLEMENTING IMPLEMENTING EFFECTIVE EFFECTIVE
COMPLIANCE COMPLIANCE MANAGEMENT MANAGEMENT
SYSTEMSYSTEM
Professional need to
Analyze & Understand
Different Corporate Structures Different Corporate Structures
Public SectorUndertakings
Private LimitedCompanies
Trusts And NGOs
Coop Societies And Producer Companies
Municipal Boards
Semi-governmentOrganisation
Unlisted PublicCompanies
Listed PublicCompanies
Different Scale of Different Scale of OperationsOperations
SMALLSCALE
MEDIUM
SCALE
LARGE
SCALE
Different Industries Different Industries
Media And Entertainment
Infrastructure, Power And Telecom
IT Solutions
IT Enabled Services And BPO
Textiles
Tourism And Hotel Capital Market And Its Intermediaries
Engineering and Construction FMCG
Agriculture AndFood Processing
Capital Goods
Drugs, Pharma And Healthcare
Banking And NBFC
Financial Services
Management Structure Management Structure & Information Flow& Information Flow
COMPANY POLICIESCOMPANY POLICIES
OPERATIONAL PLANNING AND EXECUTION
DIR A DIR B DIR C DIR D DIR E
BOARD OF DIRECTORSBOARD OF DIRECTORS
CORPORATEPLANNING
LEGALFINANCE AND
ACCOUNTSHUMAN
RESOURCESCORPORATE
COMMUNICATIONPRODUCTION
AND OPERATIONSMARKETING
INFORMATION TECHNOLOGY
DEPARTMENTS IN A COMPANY
EXTERNAL STAKEHOLDERS
INVESTORSINVESTORS
GOVERNMENT AND REGULATORS
GOVERNMENT AND REGULATORS
SOCIETYSOCIETY
SUPPLIERSSUPPLIERS
CUSTOMERSCUSTOMERS
LENDERSLENDERS
Professionals to understand their role to Professionals to understand their role to
Coordinate between various departments and all stakeholders,
Ensure compliance of all applicable laws and
Develop mutual trust between various stakeholders
COMPANY POLICIESCOMPANY POLICIES
OPERATIONAL PLANNING AND EXECUTION
DIR A DIR B DIR C DIR D DIR E
BOARD OF DIRECTORS
CORPORATEPLANNING
LEGALFINANCE AND
ACCOUNTSHUMAN
RESOURCESCORPORATE
COMMUNICATIONPRODUCTION
AND OPERATIONSMARKETING
INFORMATION TECHNOLOGY
DEPARTMENTS IN A COMPANY
EXTERNAL STAKEHOLDERSProfessional
INVESTORSINVESTORS
GOVERNMENT AND REGULATORS
GOVERNMENT AND REGULATORS
SOCIETYSOCIETY
SUPPLIERSSUPPLIERS
CUSTOMERSCUSTOMERS
LENDERSLENDERS
To work as Communica
tion Channel
Preparation for Preparation for ImplementingImplementing
Compliance Management Compliance Management SystemSystem
factual information factual information collection collection
- Company’s History & Background- Company’s History & Background
- Capital Structure & Evolution- Capital Structure & Evolution
- Promoters & Group Companies- Promoters & Group Companies
- Management & Administration - Management & Administration buildupbuildup
- Financial Soundness & Debt - Financial Soundness & Debt StructureStructure
- Risk Management & Protection - Risk Management & Protection
- Licenses & Approvals - Licenses & Approvals
- Outstanding Litigations - Outstanding Litigations
compliance reporting compliance reporting coveragecoverage
- Company law- Company law
- Securities laws - Securities laws
- Taxation laws - Taxation laws
- Industry Laws- Industry Laws
- labour Laws- labour Laws
- Environmental laws - Environmental laws
- IPR Laws - IPR Laws
- Sector Specific Laws- Sector Specific Laws
- Area/State Specific Laws - Area/State Specific Laws
identifying compliance identifying compliance timings timings
Compliance Timings
Fixed / Regular Event Based
Fixing Compliance Fixing Compliance Hierarchy Hierarchy
Compliance Manager
Zonal Head
Area Head
Factory Head
Departments Head
Wings Officers
Compliance Management Compliance Management Tools Tools
Checklists
Date wiseAct wise
Compliance Management Compliance Management Tools Tools
Software
triggering information input
triggering date & time
Information input trigger Information input trigger point point
• Organisation typeOrganisation type• Capital deployedCapital deployed• Business typeBusiness type• Product profile Product profile • Number of employees / LabourNumber of employees / Labour• Location/area of the plantLocation/area of the plant• Emission of waste Emission of waste • Income earned Income earned
Making IT Tools works Making IT Tools works as your Compliance as your Compliance
Manager Manager Demo of Compliance Management Software
IMPLEMENTING IMPLEMENTING EFFECTIVE EFFECTIVE
COMPLIANCE MANAGEMENT COMPLIANCE MANAGEMENT SYSTEMSYSTEM
A CASE STUDYA CASE STUDY
IT IT Industry Industry
specialty about industry specialty about industry • Confidentiality IssuesConfidentiality Issues
– Between client & companyBetween client & company– Between company & its employees Between company & its employees – Data confidentiality Data confidentiality
• Data SecurityData Security – – back up, disaster back up, disaster management & information recovery system.management & information recovery system.
• IPRIPR• HRD AspectsHRD Aspects – – retention plans, ESOPSretention plans, ESOPS• RestructuringRestructuring – – amalgamation & amalgamation &
takeoverstakeovers• Export BenefitsExport Benefits - - STP, EOU, SEZ STP, EOU, SEZ
Legal Framework Legal Framework • General General
– Companies Act, 1956 Companies Act, 1956 – Income Tax Act, 1961Income Tax Act, 1961– Sales Tax Act, 1959Sales Tax Act, 1959– SEBI Act, 1992 Rules SEBI Act, 1992 Rules
& Regulations & Regulations – FEMA, 1999FEMA, 1999– Copyright Act, 1957 Copyright Act, 1957 – Patent Act, 1970Patent Act, 1970– EPF & ESIEPF & ESI– Minimum Wages, Minimum Wages,
Bonus Gratuity – Act, Bonus Gratuity – Act, rules & regulations rules & regulations
• Specific Specific – Information Information
Technology Act 2000 Technology Act 2000 – Indian Contract Act, Indian Contract Act,
18721872– Technology Technology
Agreement Agreement – Joint Venture Joint Venture
Agreement Agreement – Custom RegulationsCustom Regulations– RBI CircularsRBI Circulars– Export – Import Export – Import
PolicyPolicy
Regulators Regulators • Companies Act – Companies Act – ROC, RD, CGROC, RD, CG• Labour Laws – Labour Laws – CommissionerCommissioner etc. etc.• IPR – IPR – RegistrarsRegistrars• FEMA – FEMA – RBI, FIPBRBI, FIPB• SEBISEBI – Listed Company – Listed Company• Local Laws - Local Laws - Sales Tax Sales Tax
CommissionerCommissioner, , Municipal Municipal CorporationCorporation
• Income tax officer / commissioner Income tax officer / commissioner • STP Units – STP Units – Director, STPIDirector, STPI
Compliance Management Compliance Management System System
TO COVER TO COVER • Companies ActCompanies Act – Meetings – board, AGMMeetings – board, AGM– Accounts / annual return filingsAccounts / annual return filings– Changes in constitution / managementChanges in constitution / management– Registration of chargesRegistration of charges
• Income TaxIncome Tax– TDS Deductions, payments, filing of TDS Deductions, payments, filing of
return return – Advance taxAdvance tax– Preparation of B/s & Filing of returnPreparation of B/s & Filing of return
• FEMAFEMA – FDI Procedures & disclosers – FDI Procedures & disclosers
• Labour Laws Labour Laws – Filing of return, Payment of dues like PF, Filing of return, Payment of dues like PF,
gratuitygratuity• IPR IPR – – Registration, delegation & protectionRegistration, delegation & protection • SEBISEBI
– Disclosers, Corporate governanceDisclosers, Corporate governance– ESOP, insider trading bur back takeover ESOP, insider trading bur back takeover
etc.etc.• Local LawsLocal Laws
– Renew licences, maintain attendance, leave Renew licences, maintain attendance, leave recordsrecords
• STPSTP – filing of returns , Softex forms etc – filing of returns , Softex forms etc
Due diligence at regular Due diligence at regular interval to cross check the interval to cross check the
effectiveness of Compliance effectiveness of Compliance Management System Management System
• Different Types of Due DiligenceDifferent Types of Due Diligence– Business DD Business DD – Legal DDLegal DD– HR DDHR DD– Environmental DDEnvironmental DD– Systems DDSystems DD– Tax DDTax DD– Financial DDFinancial DD– Software Ownership DDSoftware Ownership DD
Being Updated Being Updated on Different on Different Compliances Compliances
Applicability & Applicability & Keep Keep
Management Management Informed Informed
Tools for updationTools for updation
• Newsletters & Magazines Newsletters & Magazines • Discussion e-GroupsDiscussion e-Groups• Software carried automatic Software carried automatic
updating options updating options • Attending seminars & workshopsAttending seminars & workshops• Newspapers & Business News Newspapers & Business News
Channels Channels • Regular visits at Authority’s website Regular visits at Authority’s website
Professional is like back bone Professional is like back bone
of any Compliance Management System of any Compliance Management System
to any organisation and with its to any organisation and with its
Proactive Approach & Intelligence Proactive Approach & Intelligence
make an organisation front runner in its make an organisation front runner in its field… field…
Thanking Thanking you you for for an an
Patient Patient Hearing Hearing