Ernst & Young Survey: Most Companies Struggling to Comply with New Financial Reporting Regulations

Aug. 3, 2011
Companies are struggling to comply with increased regulations and the growing complexities of financial reporting and tax rules. In fact, a recent survey by Ernst & Young found that nearly two-thirds of financial executives feel changing regulations ...

Companies are struggling to comply with increased regulations and the growing complexities of financial reporting and tax rules.

In fact, a recent survey by Ernst & Young found that nearly two-thirds of financial executives feel changing regulations will challenge their compliance and reporting processes.

Remarkably, 64 percent of the Fortune Global 500 participating in this study said their companies experienced unplanned tax audits within the past year, with almost half receiving unexpected tax assessments or penalties.

The survey results, summarized in the report Seizing the opportunity in Global Compliance and Reporting, identified key areas where companies can improve global compliance and reporting (GCR). For instance:


More than 40 percent of respondents indicated a lack of global governance of statutory financial filings, and more than 60 percent indicated no global governance over direct and indirect tax filings by their companies. As Ernst & Young points out, deficiencies like these suggest that current GCR models require greater control, visibility and accountability.


More than three-quarters (82 percent) of respondents said they consider the need for local knowledge a significant barrier to moving compliance and reporting to a regional or global shared service center. Between 64 percent and 78 percent indicated that local-country resources are vital to successful compliance with tax and regulatory requirements. Clearly, these results suggest that local in-house expertise is another increasingly important component of successful GCR.


Forward-thinking companies recognize that it's time to revise and improve their methods for tax and financial reporting.

"Globalization and the drive for sustainable cost advantages change the way companies position their financial and tax operations. Companies are seeing an increasingly complex regulatory landscape and closer, cross-border collaboration by tax authorities under pressure to increase revenue," Steven Shultz, Ernst & Young Global Director of Global Compliance & Reporting Services, explained. "It is imperative that global businesses update their processes for statutory financial and tax filings to maintain compliance and competitiveness."

A copy of the survey is available at www.ey.com.

Popular Sponsored Recommendations

The Guide to Balancing Citizen Development and Governance in Manufacturing Operations

Sept. 19, 2023
Platforms with no-code capabilities provide a competitive advantage for manufacturers responding to rapidly changing disruptions and demands. This guide helps manufacturers maintain...

The Realist Guide to Sustainable Supply Chains

Sept. 28, 2023
A ‘roll up your sleeves’ guide to driving green line performance at your organization. Learn with this easy-to-understand ebook how to implement green supply chain management ...

Discrete and Process Manufacturing 2024 Trends and Outlook for North America

Oct. 29, 2023
Manufacturers are reaping the benefits of automation and cloud-based solutions. Discover what is driving today's industry trends and how they can shape your growth priorities ...

See how 3M Enabled B2B Buyers with Trustworthy Self-Service Buying Experiences

Sept. 11, 2023
This one-pager explores the importance of enabling B2B buyers with self-service purchasing experiences that engender trust and provides insights into the steps businesses can ...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!