Describe about the Compliance Management System?
This management report will be prepared after thorough research and will aim at promoting an appropriate compliance management system for an organisation. The main aim of preparing this report is to present a suitable compliance management plan. The organisation that has been selected is Woolworths Limited – an Australian retail organisation with an extensive retail in Australia and Nez Zealand. Founded in the year 1924 in Sydney, Australia, Woolworths Limited manages some of the most recognised and trusted brands of Australia. The organisation requires a compliance management system so as to maintain support with local compliance and investigation, design reviews and corporate audits. This report carefully and clearly outlines the type of compliance management system that will be most suitable for Woolworths Limited, the main aims and objectives that the system will seek to accomplish, how this system will be established in the organisation, the methodology which eill be used to monitor the system, the technique of evaluation, etc.
A Compliance Management System is defined as a system which enables as an organisation to maintain support with the local compliance and investigation, corporate audits and design reviews (Tarantino, 2008). In broader sense, compliance management system is how an institution:
• Learns about its compliance responsibilities
• Ensures that employees understand these responsibilities
• Ensures that requirements are incorporated into business processes
• Reviews operations to ensure responsibilities are carried out and requirements are met
• Takes corrective action and updates materials as necessary
An effective compliance management system is commonly comprised of three interdependent elements: include Board and management oversight, Compliance program, Compliance audit (Tarantino, 2008).
Board and management oversight: The Board of Directors is ultimately responsible for developing and administering a CMS that ensures compliance with federal consumer protection laws and regulations.
Compliance Program: A financial institution should generally establish a formal, written compliance program. In addition to being a planned and organized effort to guide the institution’s compliance activities, a written program represents an essential source document that will serve as a training and reference tool for all employees. A well planned, implemented, and maintained compliance program will prevent or reduce regulatory violations, provide cost efficiencies, and is a sound business step.
Compliance audit: A compliance audit is an independent review of an institution’s compliance with consumer protection laws and regulations and adherence to internal policies and procedures. The audit helps management ensure ongoing compliance and identify compliance risk conditions. It complements the institution’s internal monitoring system. The Board should determine the scope of an audit, and the frequency with which audits are conducted.
The organisation for which a Compliance Management System has to be established is Woolworths Limited. The company is the major Australian Company with an extensive retail in Australia and New Zealand. The Compliance Management System for Woolworths Limited will be carefully and appropriately established (McDaniel, 1990). It will ensure that effectively learns about its compliance responsibilities and that the employees understand these responsibilities. It will also see how Woolworths Limited analyses operations and ensure that all the responsibilities are efficiently carried out and requirements are met well in time. The establishment of Compliance Management System involves a series of steps (Tarantino, 2008).
IT personnel should check the inventory appropriately to know what is on the network to determine whether it’s in compliance.
Auditing:
Second step in establishing an effective Compliance Management System is the auditing.
Definitions:
Third step is to be clear about what needs to be accomplished in order to be in compliance.
Segmenting devices and mandates:
Fourth step is to separate the devices and mandate for which these have to be put for.
Monitoring:
Fifth step is to keep monitoring the system in order to ensure that nothing falls out of compliance.
Fix non-compliance situations:
After monitoring, there might be some situations which are non-compliant. Hence, it is crucial to fix them immediately so that these shouldn’t create any additional problem (Holmes, 1992).
Reporting and documenting:
Finally, every step is documented and reported to every department.
This is a seven-step approach that is followed for establishment of Compliance Management System for Woolworths Limited.
The Compliance Management System will be monitored to judge whether the methodology and impacts are proactive and effectual (Nelson, 1991). A strategic approach or methodology will be adopted to make sure that the system is monitored perfectly. Continuous monitoring method will be made use of throughout the Compliance Management System (Roland, 2008). Under this method, monitoring will be carried out all through the system and made an ongoing activity (Creech, 1994). This methodology will serve as a feedback mechanism to ensure that the aims and objectives of the Compliance Management System are effectively met (Houston, 1997). This monitoring methodology will also help to review and check disparate documents from multiple processes, and help identify the potential risks to the business activities carried out by Woolworths Limited. The monitoring will also be done by meeting the personnel of Woolworths Limited after the system has been established (Roland, 2008). By doing this, it would be easy to gather and analyse information on performance of the employees in accordance with the plan of Compliance Management System. It will also help in knowing the effectiveness of the entire system.
All in all, the certain tasks will be followed and accomplished to make sure that the Compliance Management System effective enough in fulfilling the aims and objectives of the system. These tasks are as follows:
1. Developing the compliance policies and procedures.
2. Training the management and personnel in their specific compliance responsibilities and duties (Juran, 1995).
3. Checking and reviewing all the policies and procedures for compliance will the applicable laws, as well as regulations, and also the stated policies and procedures of Woolworths Limited
4. Identifying and evaluating emerging issues or potential risks to Woolworths Limited and ensuring corrective measures are taken well in time (Angel, 1998).
5. Performing an effective monitoring and analysis of the Compliance Management System
All the powerful existing or potential risks and problems will be analysed and it will be made sure that the necessary actions are taken immediately (Zouhair, 2012). Later, the results of the entire system will be observed and maintained, and further analysed for the effectiveness of the Compliance Management system.
Most compliance initiatives start as projects to meet compliance deadlines for a specific regulation. However, compliance is not a one-time event. Organizations are thus redesigning their compliance programs to make them repeatable, sustainable, and cost-effective. Traditionally, homegrown systems, stand-alone applications, or even manual paper-based systems have been used to manage various compliance processes at the departmental level. But as various compliance initiatives become more intertwined from a regulatory and organizational perspective, multiple and disparate systems lead to duplicate, and often contradictory processes and documentation. Such environments do not provide clear visibility into organizations’ risk and compliance profiles. They also bring down efficiency, and escalate the risk of non-compliance.
Conclusion:
The research work, planning, implementation and monitoringof the Compliance Management System will be carefully carried out. Overall, the personnel of Woolworths Limited will be trained in their particular responsibilities and duties in relation to the implementation plan. After the employees are trained become well versed with all their responsibilities, the monitoring of the system will be carried out (Cri, 2013). It will be made sure that all the goals and objectives of the Compliance Management system for Woolworths Limited is successfully fulfilled and met.
Department management teams have an affirmative duty to continually monitor and address compliance concerns specific to their areas of responsibility. A critical aspect of compliance is the organization’s ability to detect and correct problems at their source through the active involvement of individual managers. Department management responsibilities include:
1. Promoting and supporting compliance with all applicable laws, regulations, policies, procedures, and the code of conduct,
2. Identifying compliance risk areas within their own area of responsibility,
3. Supporting the resolution of identified compliance issues within their area of responsibility and for reporting compliance issues and problems to the Compliance Officer.
Departmental managers and supervisors at all levels will:
1. Maintain compliance with laws and regulations as well as URMC standards, policies, and procedures that pertain to their area of responsibility;
2. Stay current with applicable laws and regulations as well as URMC standards, policies, and procedures relevant to their area of responsibility;
3. Stay current on regulatory agency updates and changes and ensure that their subordinates have a clear understanding of those affecting their duties and responsibilities;
4. Make regular compliance training and education programs available to their subordinates;
5. Identify potential risk areas specific to their department’s scope of responsibility and notify the Compliance Officer;
6. Assist the Compliance Office, as deemed necessary, in compliance auditing and monitoring, including the implementation of any necessary changes or remedial action based on findings from auditing and monitoring activities;
7. Receive and resolve problems and concerns identified by employees;
8. Maintain an open-door policy that provides employees with ample opportunity to raise problems and concerns;
9. Encourage staff to come forward with compliance issues or concerns and support and enforce the URMC’s non-retaliation policy;
10. Investigate problems or concerns reported by employees and implement necessary corrective or remedial actions.
References:
Tarantino, A. (2008). Compliance Management System. Governance, Risk, and Compliance Handbook.
Roland, A. (2008), “The ABCs of GRC”, SAP GRC For Dummies.
Zouhair, T. (2012), Aiding Compliance Governance in Service-Based Business Processes, IGI Global, pp. 524–548, Accessed 2 Mar, 2015.
Cri, R. (2013), “Internal Auditing: Assurance & Advisory Services”
Angel, R. (1998), “Total Quality Management: Origins and Evolution of the Term”, The TQM Magazine (Bingley, United Kingdom: MCB University Publishers Ltd) 10 (5): 378–386.
Houston, A. (1997), Total Quality Leadership: A Primer, Washington, D.C.: United States Navy, pp. 10–11, OCLC 38886868, 97-02, Accessed on 2 Mar, 2015.
McDaniel, M. (1990), Total Quality Management Case Study in a Navy Headquarters Organization, San Diego, California: Navy Personnel Research and Development Center, p. 1.
Nelson, T. (1991), COAST GUARD TOTAL QUALITY MANAGEMENT (TQM) GENERIC ORGANIZATION, Washington, D.C.: United States Coast Guard, COMDTINST 5224.7.
Creech, B. (1994). “The Five Pillars of TQM: How to Make Total Quality Management Work for You, New York: Truman Talley Books/Dutton, p. 153.
Juran, M. (1995). “A History of Managing for Quality: The Evolution, Trends, and Future Directions of Managing for Quality, Milwaukee, Wisconsin: ASQC Quality Press, p. 596.
Holmes, K (1992), Total Quality Management, Leatherhead, United Kingdom: Pira International, Ltd., p. 10.
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