Page 71 - IMDR MSME BOOK 2021

Managing Finance in Micro, Small & Medium Enterprises
Figure No. 20 - Set mechanism to manage the
risk faced business

The results are positive since risk identication is
relatively a new development taking place in the
business sector. Awareness about possible risks and
their identication is the rst step in the Risk
management process.
Compliance Management
India is a land of many laws. Every business since
inception must be aware about them. The birth process
of a business itself may be a derivative of compliances
like Partnership Act, Companies Act, LLP Act, in many
cases. Importance of compliance can never be
overstressed.

While protability and liquidity are non-compensable for
any business, compliance management plays apex role
for sustainability. A business may be protable and have
necessary liquidity, but if it is non-compliant for the
applicable statutes, the future is grim for survival. Legal
authorities have been created and granted necessary
powers to act against non – compliance. The possible
action could be monetary damage, suspension of
Business activity, prohibition from doing certain