FEMA compliance risks arise when organizations do not properly document, report, or validate their cross-border financial transactions, creating vulnerabilities that may lead to regulatory consequences. These risks include delays in export realization, under-invoicing or over-invoicing, incorrect classification of remittances, failure to close EDPMS/IDPMS entries, improper FDI filings, and lapses in ECB reporting. Many companies also face challenges in tracking intermediary transactions, reconciling bank data with customs systems, and maintaining required FEMA documentation for audit and regulatory review. As regulatory scrutiny increases, even minor inconsistencies can trigger queries, show-cause notices, or compounding procedures. Sriya Enterprise helps clients proactively identify weaknesses in their FEMA processes, strengthen internal compliance frameworks, and eliminate operational gaps through expert advisory, periodic audits, training, and detailed monitoring of foreign exchange transactions, ensuring long-term risk mitigation.
The Enforcement Directorate (ED) has declared that 2025 will see a sharpened focus on violations under the Foreign Exchange Management Act (FEMA), according to its Director, Rahul Navin. This marks a significant regulatory shift: FEMA compliance is being elevated to…
