The end of each year often means that businesses and internal accounting teams are determining what to invest in. This often involves a round table approach to viewing the company’s finances and determining how to reduce certain costs without forsaking the integrity of the company or the quality of products and services offered to its clients.
Here’s where entity management comes into play. Not only does this type of software minimize time-consuming, inefficient, and tedious tasks—saving your company both time and money—but it can allow your business to streamline processes and stay on top of all necessary procedures. Below, we go back to the basics and explain the importance of entity management and why companies committed to business growth are investing in this software.
KYC and AML
Financial compliance regulations known as KYC and AML, meaning Know Your Customer and anti-money laundering, are mandatory for businesses in order to prevent financial crimes and to ensure that their clients are who they say they are. Businesses are required to adhere to these processes as part of due diligence.
However, manual processes related to KYC and AML are time-consuming and inefficient. Personnel are bound to make errors, which costs companies even more money, and clients may decide to leave a deal and go to another service provider for quicker service. With an automated entity management platform, companies can spend a fraction of the time and money during these processes, allowing them to focus manual efforts on processes that can’t be automated. Plus, they can avoid financial penalities and remain compliant with all regulatory and legal procedures.
It’s hard to keep up with the day-to-day activities of employees across an entire company, especially if that company has multiple subsidiaries spread out in many jurisdictions and everyone is operating on different platforms. Without a centralized system to work out of, business operations can become inefficient and the same task can get repeated again and again.
With a cloud-based entity management system, companies can streamline their business operations and manage their vital information and sensitive documents from a system that operates as a singular source of truth. With this type of system, managers can streamline daily business operations and increase overhead in order to have a more concise picture of the day-to-day work activities of their employees.
Legal governance within an organization is a critical facet of an organization. Without having a centralized database for pertinent information, the ability to compile and control corporate records can be hindered. This included governance related to directors and officers, tax strategies, corporate names, mergers and acquisitions, and more.
With a cloud-based entity management software, legal professionals are able to operate under a singular source of truth in order to better manage compliance and tax legislation, potentially changing regulations, and associated costs for multiple entities. All the information is stored in one place and allows many tasks to be manualized so personnel can spend their time working on higher-value and more meaningful tasks.
Audit and Tax
Traditionally, audit and tax procedures were viewed in completely separate platforms than risk, management, and compliance procedures. This lack of communication where everyone is operating on different systems without a shared goal creates data silos and can increase the risk of non-compliance, financial penalties, and a bad organizational reputation. Data can be impossible to find and each department may have its own priorities to figure out, leaving important tax information in the abyss and companies far from audit-ready.
Plus, entity management software promotes departmental cross-collaboration because data is accessible and readily available for all stakeholders across the company, including legal and finance departments, auditors, corporate secretaries, paralegals, and more.
The moving components of transactions in the business world can be hard to follow for personnel who are utilizing different platforms. This can lead to issues with M&A deals because companies may not feel completely comfortable making an investment in a company that is slow out of the gates with deals or lacks a strong governance enterprise.
With a centralized entity management system, you can stand out from the crowd during M&A deals while also mitigating challenges that often arise during the transaction process. Your company can be deal-ready at any point in time in order to continue business growth and help your company reach short-term and long-term goals.
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In today’s ever-evolving technological world, the business need for a cloud-based, multi-functional entity management software has never been higher. Businesses that are to stand the test of time and reach short-term and long-term goals must invest in technology that centralizes entity, subsidiary, and business data all in one place and can be accessed from all around the world.
Ready to start centralizing your company’s data? Request a free, customized demo with an entity management expert at Athennian today!