Any business carries a set of rules and regulations that must be sustained. To uphold compliance, businesses must adhere to the laws and regulations created specifically for their industry. However, these regulations tend to change from time to time, and failure to keep up may compromise a company’s reputation and even strain its finances.
This is where compliance monitoring comes in.
Compliance monitoring is what business owners use to stay up-to-date with their industry compliance status and keep the scenario mentioned earlier from happening. Moreover, this process helps in the security and continuity of an organization.
What Is Compliance Monitoring?
Compliance monitoring refers to quality assurance testing. Typically, an organization takes advantage of a team of people who monitor procedures to ensure compliance. Some monitoring can also be automated with the use of compliance monitoring software. Using both is beneficial to ensure proper monitoring.
Compliance monitoring can help your company meet the internal process responsibilities and regulatory guidelines. It also ensures that you follow data privacy policies and cloud security. Furthermore, compliance monitoring can help ensure that your company is not violating laws and regulations.
Methods for Compliance Monitoring
Below are methods of compliance monitoring you should know about:
Self Monitoring
This method involves a responsible group or an individual that monitors and reports its own performance. Self-monitoring techniques can create greater accountability among the staff. However, it is still recommended for the management to conduct its compliance monitoring to ensure that this method is working for the business.
Continuous Monitoring
Continuous monitoring means compliance monitoring is an ongoing activity rather than a periodic one. This is a method most businesses use to ensure that transactions are processed as prescribed and controls operated as they are created. Furthermore, this can form part of the business’s internal control structure.
How to Create an Effective Compliance Monitoring Plan
It would help to consider several things in your company’s compliance monitoring plan. First is that you must create a comprehensive plan. This means it must include all compliance risks that different departments may face, such as corrupt and illegal practices, workplace health and safety, and others. Furthermore, the plan should also include the necessary steps to mitigate those risks.
It’s also vital to know that your compliance monitoring plan should suit your company’s size. Remember that it would help if your plan served the nature and complexity of your business. Moreover, your plan must convey the environment in which you operate.
The compliance monitoring plan must be detailed enough to discuss how your company conducts quality assurance testing and how often it will be. Moreover, it should also highlight who will be responsible for executing the compliance tasks.
Tips for Effective Compliance Monitoring
Compliance monitoring is a challenging process. However, below are some tips you can do to ensure effective compliance monitoring in your company:
Planning For Success
Preparation is critical to ensure that your company best uses the available resources and enables the monitoring program to be accomplished within the scheduled period.
Planning for success includes making an update and reviewing the relevant test templates against any laws and regulations. To expedite this, your monitoring team should fully understand what they are testing regarding compliance monitoring.
If you want your team to focus on the right areas, it’s best to ensure that their regulatory knowledge is always up-to-date. Awareness of any changes in rules and how your business is complying is a critical preparation.
Define Scope
If you want to determine the extent of your quality assurance testing concerning your company’s compliance monitoring, reviewing and updating test templates would be best. Doing so can help lead to clear and well-defined terms of reference.
In most cases, defining the scope means that you should:
- Know the right people to speak to within the business when it comes to compliance monitoring;
- Set out the extent of the current testing;
- Know the information that may be required to complete the testing;
- Enumerate the steps to accomplish the testing;
- Determine whose help is required to test;
- Know what happens nest;
- Determine your distribution list.
Communicate
Communication is vital to ensure effective compliance monitoring in your company. It will help if you practice setting early engagements. You should set up a meeting to talk about testing in advance.
It’s best to inform the employees of what you’re planning to do, why it’s vital, and how they can lend a hand. Furthermore, it’s also crucial not to forget the availability of the appropriate people who will help you during testing.
Some companies engage a third-party service provider for their quality assurance testing. If this is the case, the testing is recommended to be scheduled ahead of time. But, again, both communication and coordination are needed to help facilitate the testing.
Gather Evidence
After sharing your company’s terms and references regarding compliance, you’ll need your business to provide the necessary information to conduct effective monitoring. This includes all the pertinent data concerning compliance status in your business’ policies and procedure manual.
Some companies can collate this evidence through their software. However, not all compliance monitoring teams can afford that luxury.
Collecting evidence is easy if your company has a proper filing system. However, it would be best to communicate with the necessary departments regarding the matter to avoid any delays in accomplishing the compliance monitoring program. Furthermore, it would also help if you have a point of contact in each department that will facilitate the data gathering.
To Wrap It Up
Compliance monitoring can be a time-consuming and expensive process. However, it is essential to remember that the cost of non-compliance can be much higher. Non-compliance can lead to fines, penalties, and other legal action. It can also damage an organization’s reputation and credibility.
Thus, compliance monitoring is very critical for your business.
