From XU Magazine, 
Issue 23

The Right Tool For The Red Tape

It might seem like an unusual time to publish an article on compliance considering what is happening around the world today; we are talking about Covid-19 in case you are reading this in 2021. You have probably watched, read, flicked and scanned over countless articles on the CaronaVirus and we thought that you would have had enough of that for the moment. There IS a connection however between this pandemic and compliance. Bit of a reach? Read on...

Back in January 2004, the Irish government published the White Paper on Better Regulation which promised to cut down on the amount of red tape faced by business. The government committed to lightening the load on business by examining what was already in place and removing those which were no longer fit for purpose. New pieces of legislation governing business would have to be justified on the grounds of necessity.

The White Paper was greeted with relief and acclaim in almost equal measure. Small businesses labouring under an increasingly weighty regulatory burden looked forward to spending more time growing their businesses and less time on paperwork.

It would be good if we could look back and say that little had changed since. Being able to report a simple lack of progress towards the achievement of lofty goals would be welcome. Sadly, that’s not the case.

The reality is that the situation has got worse, far worse.

Late last year the Small Firms Association conducted one of its regular member surveys to take a measure of business confidence. The long shadow cast by Brexit was among the key factors influencing the decidedly negative results but one of the other highlights related to red tape.

The member firms reported that far from reducing, the burden had increased quite dramatically over the years. When the answers were aggregated, analysed and distilled down, the message was quite alarming.

What had taken them two hours a week ten years before was now taking a full day. Rather than seeing a reduction, the amount of regulations requiring compliance has increased quite significantly over the years.

Companies have had to deal with new health and safety rules, tightened environmental regulations, real-time PAYE, anti-money laundering legislation, along with change in company law – not to mention the dreaded GDPR which must be one of the most reviled pieces of law ever to emerge from Brussels.

SMEs across Europe and beyond complain vociferously about the costs associated with regulatory compliance. And while much of the blame for the red tape has been laid at the EU’s accommodating door, this is perception rather than fact.

Indeed, in a survey of UK businesses carried out last year by business leader network Vistage, 38% of respondents said they believed bureaucracy will become more of a hurdle post-Brexit, as opposed to just 17% who said a deal with the EU will lead to fewer regulations and less red-tape.

Commenting on the findings, Geoff Lawrence, Vistage General Manager UK: “UK business leaders clearly have reservations about how a negotiated exit from the EU will impact their business. The longer we go without clarity, the more these reservations will intensify.”

Almost every country has a similar story to tell. Broad agreement that red tape is a bad thing and that something must be done about it, but things keep going in the wrong direction.

Misery may love company, but it is cold comfort indeed for businesses to learn that their pain is shared internationally.

There is another way of looking at the problem, however.

Instead of bemoaning the lack of action by governments and the drain on resources represented by the regulatory burden, maybe it is time to look at different ways to deal with the burden.

A great many firms are still dealing with administrative tasks in the same way as they were back in 2004 – manually and on paper. Even where technology is used it tends to be limited to quite basic spreadsheets.

Those businesses could benefit enormously by introducing modern automation tools which would not only relieve a lot of the burden but help deliver powerful business insights along the way.

Tools like AutoEntry eliminate manual data entry of invoices, receipts, bills and statements and allow users to import them from emails, scans or even mobile phone pictures.

Consider for a moment what that would do to the VAT return process. And that’s just the beginning. The potential time and resource savings are enormous and those extra hours which have mounted up over the past ten years can be won back.

Red tape and bureaucracy may be a nuisance and a burden but needn’t be a barrier to profitable business. Not if you use the right tools.

Why leave it there?

To learn more about AutoEntry

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