Legal Audit and Compliance

Legal Audit and Compliance

Legal audit – what it is and why it is needed

Legal audit, called legal due diligence, consists in a comprehensive review and analysis of the current legal status of entities (commercial companies, entrepreneurs, civil partnerships, start-ups) or a selected issue (translation of real estate, assets, investments), the purpose of which is to identify potential legal risks that may affect both the ongoing negotiations and the implementation of investment. Audit allows you to gain knowledge and present information on the subject:

  1. the activity of the entity,
  2. profitability of the entity and investments carried out,
  3. trade agreements,
  4. titles to real estate and other property,
  5. labour and human resources issues,
  6. trademarks, licenses, concessions,
  7. copyright,
  8. the safeguarding of business secrets,
  9. encumbrances related to the granted collaterals, including in the form of guarantees or bills of exchange,
  10. administrative decisions held,
  11. execution of public procurement contracts and projects financed by the European Union,
  12. litigation and administrative proceedings.

Legal audit is a tool that serves to improve the security of business operations and reduces the legal risk associated with the business. It is proposed in particular before such transactions as the purchase of an enterprise, mergers, acquisitions, transformations, disposals or acquisitions of shares or stocks in commercial law companies, purchase of real estate, capital increase, creation of a new development policy, change in the scope of activity, planned taking up new functions in company bodies, change of management.

The effect of the conducted legal audit is a report prepared by the Law Firm, which presents noticed irregularities classified according to the degree of risk connected with them and proposed methods of eliminating irregularities.

Compliance Audit

Today’s businesses need tools to reduce the risks associated with making business decisions. Compliance is a set of procedures and systems whose task is to run a company in compliance with legal requirements, as well as to prevent the occurrence of legal risks, minimize the risk of non-compliance with legal regulations, internal regulations, recommendations and good market practices.

Compliance is mentioned as a threat to the company:

  1. engage in money laundering and terrorist financing,
  2. failure to comply with tax regulations,
  3. lack of verification of contractors in the context of VAT regulations,
  4. corruption,
  5. restrictive practices,
  6. violation of labour rights or human rights,
  7. failure to comply with environmental standards,
  8. violation of the regulations on personal data protection,
  9. Infringement of regulations concerning confidential information,
  10. conflict of interest,
  11. improper collateralisation of the company’s assets.

Joanna Jakubowska-Zawada Law Firm provides services of conducting a Compliance Audit as a comprehensive audit aimed at determining the level at which the audited entity meets the requirements of compliance and prepares recommendations and proposals for solutions tailored to the specificity of the business, the scale of the activity performed by the entrepreneur and the existing mechanisms limiting the occurrence of non-compliance risk.

Within the framework of the Compliance Audit, the Law Firm performs the following tasks

  1. comprehensive legal research allowing for the identification of risks in particular areas:
  2. examination of internal regulations and assessment of their correctness, including transactional documentation,
  3. company law, including analysis of internal procedures and rules of functioning of company bodies, development and amendment of regulations and contracts,
  4. protection of competition and consumer protection, including in particular the development and implementation of procedures for contact with the contractor in order to eliminate or minimize the risk of violation of the law,
  5. labour law, including the employer’s compliance with the obligations arising from legal regulations, including the analysis of the correctness of employment contracts, work regulations and remuneration regulations,
  6. development of a detailed report indicating risk levels in selected areas, together with proposals for solutions and legal steps to be taken to eliminate or reduce these risks,
  7. development of recommendations and recommendations that assume maximum effects while minimizing financial and organizational burdens.