AUDITING IN CIS ENVIRONMENT

BUSINESS RISK MANAGEMENT

A subset of risk management used to evaluate the business risks involved if any changes occur in the business operations, systems and process.

BUSINESS RISK MANAGEMENT

It identifies, prioritizes and addresses the risk to minimize penalties from unexpected incidentsm by keeping them on track.

BUSINESS RISK MANAGEMENT

It also enables an integrated response to multiple risks, and facilitates a more informed risk-based decision-making capability.

Risk

Involves situations where outcomes can be measured or estimated.

Uncertainty

Unvolves situations where outcomes are unpredictable and cannot be quantified.

Identifying Risks

Spotting the evolving risks by studying internal (employees, systems, management decisions) and external (economic changes, competitors, natural disasters) factors that impact the business objectives.

SWOT Analysis

Identifies strengths, weaknesses, opportunities, and threats.

Brainstorming

Team-based idea generation.

Checklists

Based on past experiences.

Historical Data Review

Analyzing previous incidents.

Analyzing Risks

It includes the calibration and, if possible, creation of probability distributions of outcomes for each material risk.

Qualitative Risk Analysis

Involves subjective judgement.

Qualitative Risk Analysis

Risks are ranked as high, medium, or low.

Qualitative Risk Analysis

Useful when numerical data is unavailable.

Quantitative Risk Analysis

Use numerical data and statistical methods.

Quantitative Risk Analysis

Measures probability and financial impact.

Responding to Risk

After identifying and analyzing the potential risk, appropriate strategy needs to be incorporated.

Risk Avoidance

Eliminating the activity that causes risk.

Risk Reduction (Mitigation)

Reducing the likelihood or impact of risk.

Responding to Risk

After identifying and analyzing the potential risk, appropriate strategy needs to be incorporated.

Risk Sharing / Transfer

Transferring risk to another party.

Risk Acceptance

Accepting risk when cost of mitigation is higher than potential loss.

Monitoring Risk and Opportunities

Continually measuring the risks and opportunities of the business environment.

Monitoring Risk and Opportunities

Keep a check on performance of management strategies or evaluating the effectiveness of responses.

Hazard

Anything in the workplace that has the potential to harm people.

Hazard Risk

Includes factors which are not under the control of business environment, such ss fallout of machinery or dangerous chemical, natural calamities.

Financial Risk

A large number of businesses take risk with their financial assets, quite regularly.

Business Risk Management

Should say how much risk is too much in financial relationship.

Credit Risk

Customers failing to pay debts.

Liquidity Risk

Inability to meet short-term obligations.

Market Risk

Losses due to changes in interest rates, exchange rates, or stock prices.

Operational Risk

Evaluation of risk loss resulting from internal process, system, people or due to any external factor through which a company operates.

Strategic Risks

Might arise from making poor or wrong business plans and losing the competition in the market.

Enterprise Risk Management (ERM)

A comprehensive, organization-wide approach to identifying, assessing, managing, and monitoring risks that may affect the achievement of strategic objectives.

Enterprise Risk Management (ERM)

Not just about avoiding losses, it is about making better decisions under uncertainty.