When it comes to dealing with changes, being one step ahead is a must for organisations to ensure the best result possible.
For chief financial officers overseeing operations across Asia-Pacific, the Middle East, Europe, and the Americas, building compliant, scalable finance functions in unfamiliar jurisdictions is a high-stakes challenge.
Asset acquisitions, market entries, and decentralised operations demand more than technical expertise, as they require navigation around fragmented regulations, cultural complexities, and resource constraints while ensuring agility and compliance.
From establishing local gap reporting to designing anti-fraud controls in multilingual environments, success hinges on balancing global standards with hyper-local realities.
As cross-border complexities grow and regulatory scrutiny intensifies, CFOs are faced with the question: how do we future-proof our finance infrastructure to thrive in uncertain multi-jurisdictional landscapes?
Oleg Kozlov, head of internal audit at Modern Mills Company, discusses how CFOs traverse multi-jurisdictional finance challenges in 2025.
Harmonising financial reporting and compliance
Finding the balance between financial reporting and compliance across multiple jurisdictions, while trying to comply to global standards such US GAAP and IFRS with local tax regimes and regulatory requirements without overburdening local teams can be such a huge task for many organisations.
Kozlov recounts to his experience, saying he has seen local teams frequently overburdened by maintaining multiple sets of books, such as IFRS, US GAAP, local tax.
"To prevent the overburdening in local teams, what I found effective (and) is a critical factor is leveraging new technology to automate the conversion between local and global reporting standards," he says. "Basic intelligence tools such as Power BI can streamline the process, reducing manual effort." Initially, the dual workload of maintaining manual records alongside automated systems can seem demanding for your teams."
Kozlov concedes that at first, the dual workload of maintaining both records alongside might be overburdening for the team, but the upfront efforts will pay off substantially once the system is established and validated.
"Second, in the complex and rapidly changing regulatory environment, such as Brazil or Kazakhstan, where government strictly regulates things like invoicing or chart of accounts, implementing dedicated local ERP system tailored precisely to local compliance requirements will further reduce the burden on the local finance staff."
Kozlove says these localised ERP systems are typically cheaper to implement and maintain compared to the global ERP platforms, even considering GXP validation if required.
Moreover, he notes that implementing local ERP system can free budgets for additional local staff, as this significantly reduces the pressure on local team as they can expand local resources.
"Lastly, regardless the chosen approach, robust data governance and internal controls are essential for maintaining integrity between local and global systems," he says. "Assigning dedicated experts, especially for forecasting activities, which commonly recorded with less detail, would further reduce the stress on local teams, enhancing both accuracy and efficiency."
Kozlov adds that in particularly sensitive countries such as Poland, Ukraine, Vietnam, or the Philippines, working with local compliance specialists is a must, along with consistent and frequent training.
Strategies
From a finance perspective, Kozlov explains that it is essential to embed a structured pricing mechanisms directly into one's CRM or ERP system.
"This includes clearly built price build-ups with well-defined base prices, discounts, rebates and surcharge structures. Approval and escalation levels should be clearly documented and divided across sales, finance and pricing committees, if available, and strictly follow delegation of authority threshold with robust anti-collusion protocols."
Additionally, he recommends implementing stringent controls around the issuance of credit and debit notes, ensuring these do not become hidden discounts or ways to bypass proper code authorisations.
"Every transaction must explicitly detail amounts, validity deadlines, product specifics, price list and project identifiers. If possible, use data analytics to detect suspicious pricing patterns or unusual customer allocation patterns."
He says he has learned that it is particularly effective to appoint a dedicated pricing and margin manager as a full-time position t ensure complete independence from sales or commercial directors.
Furthermore, as part of the strategies needed, one must proactively build trust relationships with their sales, suggesting they should be a business partner and a gatekeeper, rather than a barrier.
"This is particularly relevant for complex offers or bundle deals that may require approvals outside of ERP or CRM system. Serve as a liaison between sales and compliance teams," Kozlov says.
Finally, he notes that a robust antitrust compliance demands a close monitoring and controlling of sales-related expenses.
"Scrutinise how sales teams plan and execute customer and competitor interactions, including attending events organised by customer or local chambers of commerce. Ensure transparent and timely reporting of expense reports along these interactions. This would help keep your market activities compliant and mitigate antitrust risks."
Leveraging technology
As part of future-proofing the finance infrastructure, CFOs are in need to leverage digital technologies, including AI and machine learning, to automate compliance processes and enhance finance operations, while at the same time managing risks like data privacy and algorithmic bias.
Kozlov believes finance heads must master practical automation tools to simplify routine compliance reports.
"For instance, automate transfer pricing documentation by integrating ERP data directly into cloud-based BI tools, which significantly would reduce manual efforts and the time required to produce accurate reports."
Then, Kozlov recommends implementing AI-driven analytics for proactive compliance monitoring, setting automated triggers that detect anomalies or unusual transaction patterns early, enabling rapid response by finance or compliance teams.
He warns, however, to be sure to continuously validate these algorithms to guard against bias and ensure accuracy.
Finally, Kozlov says finance heads must establish rigorous data governance practices and restrict access controls.
"By tightly managing data ownership and accessibility, you effectively manage data privacy risks associated with digital automation and advanced analytics."
Oleg Kozlov, head of internal audit, Modern Mills Company
Addressing talent woes
In dealing with talent woes, Kozlov recommends bringing a temporary support from an experienced global finance team.
"I would recommend to bring a temporary support from a global finance team for a short-term assignment from three months to a year," he says. "This person can ensure a rapid alignment with global standards and compliance practices. Conduct targeted job training and bridge cultural and operational gaps until the local team is fully up and running. As a leader, I learned that some local workplace behaviours could initially appear toxic or unusual from a cultural viewpoint."
Therefore, it is necessary to prioritise understanding these local norms deeply. Kozlov says finance leaders must carefully gauge cultural fit during the recruitment process as cultural mismatches can drive turnover justice from compensation or growth concerns.
In addition, transparent communication on global expectations about culture and overtime attitude while openly acknowledging local working styles is important.
He further suggests on clearly setting performance targets from the start as this could help reduce friction and build trust early.
"Finally, position yourself as a cultural liaison. Show mutual respect for local expertise rather than imposing global experience. Demonstrate how different strengths complement each other."
Agile operational processes
In terms of the need for agile operational processes, including accounts, payables, receivables, or even payroll, that in this particular situation can adapt to sudden currency volatility, perhaps sanctions, or geopolitical risks across diverse markets, Kozlov stresses on the idea of implementing a reliable local ERP system that can significantly enhance operation resilience, especially during periods of geographical or financial uncertainty.
"This ensures continuous support of critical operations, even under sanctions, while your company goods may remain permissible under the international restrictions, the global ERP access might be restricted," he explains.
"For payroll, given its sensitive nature and common requirements to store data on local servers, I would recommend outsourcing it to the third party right away or have one ready in your contingency plan."
Proactively maintaining adequate local capital reserves and regularly performing stress test scenarios to prepare for potential restrictions on currency conversions or capital flows is a need.
However, if one decides to use a local ERP system, Kozlov notes that it is essential to ensure that the system is open-coded, which would ensure business continuity as this allows one to change coders to maintain the system.
Kozlov points out that structuring regional legal entities, considering geographical politics to allow compliant and flexible capital management, is a must, alongside ensuring financial stability under various regulatory environments.
"Finally, diversify operational capabilities by developing relationships with reputable local suppliers and counterparties capable of complementing or temporarily substituting international partners if needed."
The role of localised finance hubs
For Kozlov, while one can simplify oversight by centralising operations into regional hubs, it may not always be the most compliant or cost efficient method.
"High-risk countries commonly have rapidly evolving regulatory environments, which makes customisation costly and requires continuous maintenance," he says.
Moreover, labour costs in volatile countries typically, although not always, are more economical and culturally more effective.
"For instance, tasks like collections are highly culturally sensitive, and I've seen local teams consistently achieve better outcomes due to the deeper cultural understanding and stronger customer relationships," he explains. "Ultimately, regional hubs should serve primarily as a center of excellence, providing a high-level compliance expertise, guidance, and oversight."
He stresses the need for clear documentation and communication of decision-making authorities between global headquarters and local hubs to empower local teams to act autonomously and respond rapidly to regulatory shifts, while maintaining strategic alignment and centralized oversight.
Advice
To build sustainable, compliant finance functions in unfamiliar jurisdictions, Kozlov advises CFOs to develop and follow structured integration checklists, tailoured specifically for situations involving transitional data based on your prior experience.
"If you don't have prior experience, hire a consultant or find a talent who has. Prioritise compliance controls and rapid operational stabilisation first."
He recommends immediately forming a cross-border integration team, combining local regulatory experts with the global finance professionals to ensure rapid knowledge transfer and proactive resolution of regulatory gaps.
"Establish a clear post-acquisition governance framework with explicit accountability for ongoing monitoring of regulatory compliance and operational effectiveness. Ensure sustainable integration in complex new jurisdictions."
