New Zealand is widely recognised as one of the most business-friendly countries in the world, often topping various global rankings related to the ease of doing business. Of course, in any functioning country, business-friendliness does not imply a free-for-all environment. Businesses in New Zealand must adhere to strict and ever-evolving regulatory requirements, just as their counterparts do overseas.
Regulatory requirements are sometimes seen by some business stakeholders as putting the brakes on growth. However, taking a wider view, they are often necessary for protecting consumers and guaranteeing public revenues for maintaining common infrastructure. Regulations are also often imposed by certain industries themselves to maintain specific standards and to enable more leverage when dealing with national governments, benefiting everyone as a whole.
Knowing all that, it’s easy to see why regulators are not keen on letting compliance delinquencies slide. Compliance failures can lead to severe legal and financial repercussions, including hefty fines, loss of operating licences, and reputational damage. These risks also tend to increase with an industry’s complexity and significance. Healthcare, banking and finance, energy, and pharmaceuticals exemplify highly regulated sectors both in New Zealand and worldwide.
If your business operates on the South Island, hiring accountants in Dunedin can help you manage compliance risks effectively. As a key economic and administrative centre, Dunedin is home to a range of businesses in finance, healthcare, and technology — industries that face stringent regulatory requirements. Understanding key accounting considerations not only ensures compliance but also provides financial clarity and security for your business.
Below are some key points about regulatory compliance from an accountant’s perspective:
1. Industry-Specific Regulations
The accountants you hire must have an in-depth knowledge of the specific regulations governing your industry. Areas covered can include such things as financial reporting standards, tax requirements, and operational restrictions that matter across all the jurisdictions where your business operates. The more complex your business, the more likely it is to need accounting firms with the manpower and specialisation to address all your industry-related challenges.
2. Maintaining Accurate and Transparent Financial Records
Both government and private regulatory bodies often require businesses to maintain meticulous financial records, with the data presented according to specific standards to aid in auditing. Accountants will have to be familiar with the standard reporting that applies to your industry and be able to draft reports to match the needs of your regulators.
3. Implementing Sensible Internal Controls
Internal controls help mitigate and deter fraud, errors, and financial mismanagement. However, one-size-fits-all controls do usually work, even for organisations within the same industry. A knowledgeable accounting firm should be able to consider all your unique challenges and recommend internal controls that work for your business.
4. Tax Regulations and Obligations
Complex tax laws are not exclusive to highly-regulated businesses, but they often go together. Your next accounting hire must be knowledgeable about industry-specific levies, goods and service taxes, and corporate taxes. This not only guarantees on-time payments of the right taxes, but enables a more strategic view of your compliance activities, which also leads toward more sensible long-term cost planning.
5. Audit and Reporting Requirements
The more regulated your industry, the more frequent your audits tend to be. Aside from ensuring that all necessary financial documents are accurate and readily available for review, experienced accountants should also be able to guide other business stakeholders in assisting with the audit process, smoothening out any issues that regulators might encounter.
6. Managing Data Protection and Emerging Cybersecurity Regulations
Aside from just keeping and presenting financial records, accountants are now expected to take responsibility for protecting digitalised financial data, in accordance with data protection and cybersecurity regulations. This can involve a range of diverse activities, including implementing more secure accounting systems, monitoring access to financial data, and keeping abreast of New Zealand and overseas legislation that may apply to the business.
7. Ensuring Ethical Financial Practices
Ethical financial management has always been a cornerstone of accounting in regulated industries. Accountants must not only consider what is strictly legal; they should also consider the ethics of their recommendations, particularly when it comes to avoiding conflicts of interest.
8. Staying Prepared for Regulatory Changes
If your business is in a highly regulated industry, the laundry list of taxes and financial reporting requirements is only going to become longer with time. Your accountants must be prepared to do ongoing training, engage with regulatory bodies, and explore your industry networks to help your business anticipate and adapt to changes more efficiently.
How Should You Approach Your Financial Compliance Challenges?
Ensuring compliance in less-regulated small businesses can be difficult enough, and the challenge just becomes greater the larger and more controlled a business is. Even in a country as business-friendly as New Zealand, financial reporting and adherence to regulatory standards must still be done at very high levels.
Regardless of how regulated your industry is, working with experienced accountants and doing your own homework on compliance obligations will keep your business legal.
