Business Environment is the world around a company over which it has no direct control. It covers many dimensions impacting a company's activities & performance. It is an aggregate of all forces & factors external to the business enterprise, but which influence it's functioning. There is a mutual inter-dependence between business and its environment.
A business enterprise is an open system and it continuously interacts with its environment. Businesses take inputs like raw material, capital, labour, energy, etc. from the environment, and transform them into goods & services, and then send them back into the environment. Interaction between business and environment is in various ways such as: exchange of information, resources, influence & power. It affects the doing of business. Business environment around the globe and in India to be understood.
1. Global Business Environment
Globalization is a three dimensional concept. It is a phenomenon, a philosophy, and a process. The world is becoming smaller. As globalization continues, businesses will be presented with opportunities and face challenges. Doing business globally is always a complex task. Business has to be adaptive to different economies, cultures, laws, restrictions, political environment, taxation systems. Business has to understand these and take decision regarding which foreign market to be penetrated, when to enter, at what price to be entered, what is the cost of doing business in a particular economy, how the tax system of a particular country works, whether the country has double tax avoidance treaty with home country and so on..
2. Business Environment in context of Indian set-up
India is the youngest country in the world. India has been emerging as one of the fastest growing economies around the globe. India has opened the doors to all the players with the introduction of FDI and the same are being liberalised day by day. New sectors are being opened. Competition is being increased. Set-up a business in India requires various licences to be obtained. It takes few days. Political structure in India is such that a business enterprise wants to do business on Pan India then it has to understand the regulatory system covered under the federal government regime and various state Government domain. Laws which are under the purview of State Government differ from State to State. This is the major drawback in Indian System. Various states have different business policies for different businesses. Business House has to study it well and then can take decisions.
KASCO can provide you the assembly of different teams of professionals so that you can take decision on business set up at any location with clear understanding of various local and federal laws.
Main aim of any governance and reporting requirements is to attain more transparency in the information. In India also now a days the governance and reporting requirements are being increased. More and more corporate transparency is the need of the time. Investors need more accurate, relevant and transparent information about the companies, market, transactions and risk. Even the regulators also want to extract more information from the reporting made to them by various business enterprises to gain more control over the regulations.
In India the reporting requirements are being defined under various laws whereby the Government can have better governance of the system. Various taxation laws in India have set out different reporting requirements. Direct Tax Laws, Indirect tax laws, local bodies legislations, SEBI, Stock Exchanges etc. have various jurisdictions over the business enterprises by fetching various reports from the business enterprises.
Accounting Standards are the language in which the financial reporting of any business enterprise is prepared. It shows the process and considerations in preparing the financial reports of the business. Every country has developed their own Accounting Standards that suits the business practices being carried out in the country. But with the globalisation and more and more businesses stepping into the global market, the need arised about the common accounting language across the world. IFRS is the outcome of the same. India has also adopted the Accounting Standards (IND AS) which are being made compulsory in a phased manner starting from the Accounting period 1ST April, 2015. These IND AS are converged with IFRS.
KASCO can help you to understand the applicability of various Accounting Standards and its reporting and disclosure requirements. We have a rich experience of reporting of various growing companies which will help you to make your financial statements more transparent and informative to the various stake holders.
In any challenging business environment, Finance is the life blood of any business activity. Managing the Finance of the business will save the business from increased costs in various respects. It helps your business to lead with sound financial position and management. Financial management in any business will identify the savings and efficiencies. Financial management includes inter alia various policy decisions viz. To produce or to outsource, whether services to be shared or not.
Risk is the inherent characteristic of any business environment. Any business will be benefited by prudent risk management. Risk management means defining the key risk areas, scaling their probabilities and their impact on business drivers and at the same time developing the counter mechanisms.
KASCO can work with you in this. We have the breadth of experience of working with various corporates, business cultures and ideologies. We can help you in developing various controls and processes which will create values and drive your organisational behaviour so that your finance function can adhere to your business needs and can add to your future business plans. We can conduct the planning to your key risk areas and make your risk management process linked with the business risks. We can help you out in developing effective controls that can give you early warning against risks which will enable you to respond quickly and effectively.
Indian economy is one of the fastest growing economy in the world. It is estimated the growth rate of Indian Economy will be much a head than the others around the globe. Global expectations for Indian Economy is also very positive and that will help to drive the economy and the business at high speed. All round development in the area of manufacture, service industry, infrastructure, e-commerce etc. is expected by various global agencies. Foreign investors have shown more confidence and India is one of the hot investment destinations in the world. Indian market is young and vibrant. Public and private spending are increasing. Thus, business potentials are bright.
KASCO can help you to take right and informed decision in setting up business in India. Blending of team of professionals at KASCO is its strength that can drive your expectations to the satisfaction.