How do you prioritize risk controls when faced with limited resources for financial forecasting accuracy?

Risks are everywhere but you have to search for them and prioritize them. You can't mitigate every potential issue. But some have greater potential impact.

Everyone is Risk manager it is important to imbibe this message within the risk culture of the organization. Thereafter, it is important to have a clear and precise line of escalation which would help the firm to get information of not only current risk but also emerging risk within an organization with limited forecasting tools. The organization can use various tools such as Risk Control Self Assessment summary (RCSA) to understand the risk within the organization.

A key risk factor relevant for financial forecasting accuracy is management bench strength especially if significant growth is envisaged.

Gosto de pensar sob a ótica de que risco e oportunidades andam sempre juntos, portanto, não há oportunidades sem risco. Dito isso, antes de começar a identificar os riscos, é muito importante definir claramente os objetivos corporativos e só então seguimos para a descoberta e definição dos riscos além de detalhá-los ao máximo de forma estruturada. Para se chegar a uma lista de riscos relevantes é importante considerar também entrevistas com os principais stakeholders das mais diversas áreas da empresa, na seqüência identifique os fatores de risco (internos e externos), busque identificar as causas prováveis para estes riscos, lembrando que podem se únicas ou várias causas para o mesmo risco.

I prioritize risk controls by focusing on high-impact areas when faced with limited resources for financial forecasting accuracy. First, I identify the key risks that could significantly affect the economic outcome. I allocate resources to control and mitigate these risks effectively. I do this by prioritizing using a risk-based approach, such as the likelihood and impact of risk. I also drive the leveraging of technology and automation to drive process efficiency. Finally, I continuously monitor and adjust controls based on evolving risks and feedback to ensure ongoing accuracy and strength.

Once you know what could go wrong, think about how bad it would be if it actually happened. Would you lose money? Would people stop trusting you? This helps you figure out what's really important.

Os riscos precisam ser avaliados quanto a probalidade e o impacto de sua ocorrência. Uma maneira de avaliar a probabilidade de que um risco se manifeste é analisar se os controles os controles existentes, e o impacto de um risco é geralmente definido considerando o nível de severidade deste impacto, essa definição é complexa porque em muitos casos trata-se de uma avaliação qualitativa e “julgamental”. O resultado final dessa avaliação é uma combinação das avaliações de probalidade e impacto oriunda de uma matriz de avaliação de riscos. Importante considerar revisões periódicas desses coeficientes de multiplicação da matriz, visto que, os cenários podem mudar ou a medida que os controles evoluam os impactos podem ser reduzidos ou aumentados

When faced in such situations and depending on the nature of cover we act as doctors would by elimination to reach the core issue. Experience is an important factor and good legal background

From underwriting perspective, when faced with limited resources for financial forecasting accuracy, I would prioritize risk controls based on the potential impact and likelihood of the identified risks. I would focus on the most critical risks that could have the most significant financial consequences, while also considering the feasibility and cost-effectiveness of implementing the necessary controls. This approach would involve a thorough risk assessment, clear communication with stakeholders, and a strategic allocation of available resources to ensure the most effective risk mitigation strategies are in place, ultimately enhancing the accuracy of financial forecasting.

Resource allocation is where a committee of senior management/leadership is often necessary. While risk owners may identify, assess and create controls, it is often the senior leadership who has the power to say yes/no on where resources are directed. In a committee form, multiple senior leaders from various areas of an organization can be involved in the discussions and develop an agreement on where resources are allocated.

Wichtig ist, sich auf die Eliminierung von existenzbedrohenden Risiken mit hoher Eintrittswahrscheinlichkeit sowie deren Auswirkungen zu konzentrieren. Beispielsweise können gewisse Aktionen und Geschäftschancen unterlassen werden um ein solches Risiko auszuschließen (Risikovermeidung). Ist es nicht möglich mittels Risikovermeidung das existenzbedrohende Risiko auszuschließen muss dieses entsprechend vermindert (z.B. Absicherungsinstrumente wie eine Bankgarantie) bzw. auf andere Projektpartner abgewälzt werden (z.B. Versicherungen, Baufirmen). Letztendlich muss in der Risikobewertung nach dem Einsatz der Instrumente zur Risikosteuerung ein akzeptables Restrisiko vorliegen welches dann vom Unternehmen selbst getragen werden kann.

Ein essentielles Tool ist die Implementierung eines funktionsfähigen Internen Kontrollsystem (sog. IKS). Die Voraussetzung dafür sind insb. klare, transparente und gut dokumentierte Entscheidungsprozesse, eine strikte Aufgabenverteilung und Zuweisung, die Sicherstellung der Übereinstimmung interner Entscheidungen und Abläufe, klare Kontrollmechanismen wie Funktionstrennung und / oder 4-Augen Prinzip. Wichtig ist die Fokussierung auf die Schlüsselprozesse im Unternehmen. Dadurch sollen Aufbau- und Ablauf organisatorische Regelungen mit klarer Abgrenzung der Verantwortungsbereiche sichergestellt sein. Wichtig sind Prozesse zur Identifizierung, Beurteilung, Steuerung sowie Überwachung und Kommunikation der Risiken.

Do what you said you'd do! Maybe you need better security, or a plan if your supply chain gets messed up. Whatever it is, get it done

Key Risks Indicators (KRI) are crucial for effectively managing risks. They are developed based on: 1. Organisational objectives 2. Risks associated with business processes, including their root causes and historical data on past organisational events 3. The specific metrics to be measured must be aligned with the objectives to achieve, considering the frequency, and both internal and external factors affecting the organisation 4. Risks that could impact the KPIs 5. Establishment of the responsible for calculating and monitoring KRIs, including the frequency and method of reporting results It is important to emphasise that these indicators must be measurable, quantifiable and accurate.

Don't just set it and forget it. Check if your plan is still working. Things change, so you need to change with them. and update with the latest approach.

É praticamente impossível se livrar de todos os riscos, então precisamos priorizar aqueles que serão tratados e definir o apetite de risco. Os possíveis direcionamentos aos riscos podem ser: tolerar, transferir, tratar e eliminar. Para todos os riscos, exceto aqueles que serão tolerados, é necessário elaborar um plano de ação ou estratégia de mitigação para prevenir, reduzir, eliminar ou transferir o risco. Importante também levar em consideração a relação custo x benefício ao decidir tratar ou não um risco. Tão importante quanto tudo o que já foi citado, é o processo de monitoramento contínuo dos riscos e por isso eles precisam ser reavaliados regularmente. O objetivo disso é garantir que os riscos estão sendo administrados de forma eficaz

To prioritize risk controls when faced with limited resources for financial forecasting accuracy: 1. Identify critical risks: Focus on risks with the greatest potential impact on financial forecasts. 2. Risk assessment: Evaluate the likelihood and potential impact of each risk. 3. Cost-benefit analysis: Assess the cost of implementing controls versus the potential benefit. 4. Prioritize high-impact controls: Focus on controls that will have the greatest impact on reducing risk. 5. Leverage existing resources: Utilize existing resources, such as personnel and technology, to maximize efficiency. 6. Targeted mitigation: Implement targeted risk mitigation strategies rather than comprehensive solutions.