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Compliance Costs for Wealth Management and Financial Services Could Harm Your Business says Sydney Chartered Tax Accountants TLK Partners
Compliance Costs Could be Killing Young Businesses Says Financial Expert Matthew Mousa of TLK Partners, Kingsgrove
Although regulation is necessary to ensure a healthy business climate, an excess of red tape and high compliance costs could be smothering small businesses says financial expert Matthew Mousa of New South Wales based TLK Partners. Cutting compliance costs while still managing to stay on the right side of the law could be one of the keys to profitability – and even business survival.
Although Australia is a relatively affluent country that has managed to sustain 27 successive years of economic growth, Matthew believes we could be doing a lot better. Although the Global Competitiveness report ranks Australia 21st among world economies, it performs rather less well for ease of doing business as, says Matthew, a great many of his clients will attest.
“Australia is a great country in which to do business,” says Matthew, “but the regulatory environment isn’t the easiest to navigate. This is underlined by the staggering estimates of the compliance costs embedded in the Australian economy. Indeed, there are fears that there’s a downturn in the number of new businesses opening their doors, and the compliance burden is among the factors contributing to this state of affairs.”
The Institute of Public Affairs has been sounding warnings for some years now and has published studies indicating that red tape costs Australia in the region of 176 billion dollars per year. The public policy think tank may be raising the alarm, but that’s cold comfort for small and medium enterprises struggling to stay afloat in a complicated and costly business environment.
Chamber of Commerce surveys indicated that more than 25 percent of businesses say they spend over 11 hours a week on compliance-related tasks. And just under half of businesses cite compliance costs in excess of $10K per annum.
“Small businesses bear the brunt,” says Matthew. “They don’t have the in-house teams of lawyers and accountants. They’re constantly forced to negotiate a legal minefield, and when you consider that most Australian businesses have four or fewer employees, 11 hours per week is a huge bite out of productivity.”
While there have been many calls for reforms to simplify the compliance landscape, Matthew warns that we shouldn’t expect any revolutionary changes. “The legal environment in which we operate is, by definition, a conservative one. That means that any proposals for changes that make it easier to get things done won’t be approved anytime soon,” says Matthew. “By now, everyone knows that compliance costs are a problem. Changing that won’t happen overnight.”
For smaller firms struggling with red tape, he recommends outsourcing legal and financial compliance functions since the work is then done by specialists who are already familiar with the procedures to be followed. “TLK Partners has something special to offer because it coordinates these two areas as a single entity. But whether smaller enterprises choose us or decide to go the traditional route with separate legal and accounting firms, I believe that professional help ultimately represents an economy.”
For more information on TLK Partners, Chartered Accountants and Wealth Management Company and its holistic approach to wealth management, accounting and legal compliance, visit their website, or contact their Kingsgrove offices on (02) 8090 4324.
This material is of a general nature only, it does not take into consideration your financial circumstances, needs or objectives. Before making any decision based on this content, you should assess your own circumstances, seek professional advice or contact our office to be directed to the appropriate professional. Whilst all care has been taken in presenting the material neither TLK Partners or its associated entities guarantee that the material is free of error and, the information may have changed since being published.
Syndicated by Baxton Media.
Also published on Medium.
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The information contained in this article is based on the authors opinion only and is of a general nature which is not indicative of future results or events and does not consider your personal situation or particular needs. Professional advice should always be sought relevant to your circumstances.
Also published on Medium.
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