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compliance

kum-PLY-unss /kəmˈplaɪəns/

nounC1GREGMATIELTS

formalprofessionallegal

The action or fact of complying with a wish, command, or law.

In finance, compliance refers to strictly adhering to tax laws, regulations, and filing deadlines to avoid penalties.

The story behind the word. Derived from the verb 'comply', which comes from the Latin 'complere', meaning 'to fill up' or 'complete.' To be in compliance is to 'fill up' or satisfy all the requirements of the law.

Word relationships

adherence: Adherence is sticking closely to a rule or belief, while compliance is the active state of obeying a legal command.
conformity: Conformity is behaving in accordance with socially accepted standards, whereas compliance is obeying specific laws.

defiance: Defiance is open resistance or bold disobedience.
noncompliance: The failure or refusal to comply with a law or rule.

Commonly confused with

complacence: Complacence is a feeling of quiet pleasure or security, often while unaware of unpleasant possibilities, whereas compliance is obedience.

Word family

comply (verb): To act in accordance with a wish or command.
compliant (adjective): Disposed to agree with others or obey rules.

Collocations

tax compliance
ensure compliance
regulatory compliance
in compliance with

Example sentences

"Tax compliance is essential to avoid heavy penalties and interest." Corporate Policy

Memory hook

Compliance is when you 'comply' with the 'alliance' of laws. Complying with the law.

When not to use

Do not confuse with 'complacence' (smug self-satisfaction).

Fun facts

The cost of tax compliance is enormous; Americans spend an estimated 6 billion hours every year preparing and filing tax returns.