Managing multiple business entities across a variety of jurisdictions can be a challenge. An Entity Management System can help make the job a little easier by bringing all of a business's compliance and recordkeeping activities into a single, online portfolio - streamlining internal processes and making it easier to satisfy statutory requirements.
Despite their usefulness, CLAS has found that there are a host of misconceptions or “myths” surrounding Entity Management Systems. In this article, we strive to debunk Five Common Entity Management System Myths.
Myth: Entity Management Systems are only useful for large corporations.
Truth: An Entity Management System can be useful for businesses of all sizes, from small startups to large corporations with entities around the globe. There are many compliance and record-keeping requirements for every business, and depending on who is managing those responsibilities and what other duties are assigned to them, an Entity Management System could make a lot of sense for even a small portfolio.
Myth: Entity Management Systems are expensive and difficult to implement.
Truth: While an Entity Management System can be a significant investment for businesses, there are many options available that are affordable and easy to implement. It’s important to shop around and find the best system depending on the size of your portfolio and specific needs.
Myth: Only compliance and legal teams can benefit from an Entity Management System.
Truth: While compliance and legal teams may be the primary users of Entity Management Systems, these systems can also benefit other departments within a business such as finance, human resources, and operations. An Entity Management System can help these teams better manage entity-related data, such as financial records, personnel data, and vendor contracts.
Myth: An Entity Management System can replace the need for legal counsel.
Truth: While an Entity Management System can help businesses manage their legal and compliance obligations more efficiently, they cannot replace the expertise of a qualified legal professional. An Entity Management System can provide businesses with tools and resources to stay compliant, but it's still important to consult with legal counsel when making significant decisions or facing complex legal issues.
Myth: Entity Management Systems are only relevant to businesses operating in multiple jurisdictions.
Truth: Entity Management Systems can be useful for any business, regardless of where they do business. Even businesses operating in just a single jurisdiction can benefit from the improved organization streamlined processes provided by an Entity Management System.
Overall, an Entity Management System can be a valuable tool for businesses looking to streamline their legal and compliance processes, improve record-keeping and reporting, and reduce the risk of non-compliance.
EntityTrak™ from CLAS Information Services is an affordable online Entity Management System that enables users to seamlessly manage the lifecycle of their business entities from inception to termination.
Ready to see the system in action? Let’s set up a time for a quick 15-minute system demonstration and explore how EntityTrak™ can help your organization gain efficiency, maintain compliance and mitigate risk. Click here to request a system demo.
For informational purposes only; content does not constitute legal advice.