Introduction
Risk management is a program planned to identify potential events which may have impacts on a business. Effective of risk management ensures the continuity of business operation. For an effective risk management program the following steps should be considered. Evaluating risks, identify risks, develop measures to treat risks, implement and finance risk management, program review (Holmes, 2002). The risk management is geared to achieving a business’ objective and aims through the following risk management process.
Management Level is responsible for the running of the business and has specific executive powers. Management level is a team that implements the vision of the company. The management level integrates risk by creating a plan and focus committee that foresee and assess raising crisis (Hopkin, 2010). Strategic planning gives the company a direction to move in.
Risk Strategic is the process used by companies to forecast their functions. Strategic is an essential or important in relation to a plan of action. The management applies external events that aid in prediction of demand and the company’s ability to respond to the demand. The management should react to changing interest rates (Crouhy, Galai, & Mark, 2000). Risk management should therefore be at the core of a business strategic management process.
A corporation is a business entity with a legal status of a person at law. Finance Tactical SBU Bundle Operational Project is strategic that is used in financial planning which indicates a clear, tactics and well thought format in a business which intends to increase profitability. Tactical is a conceptual action implemented as more specific tasks (Holmes, 2002). In financial tactics the risks include inflation risk, taxation risk and currency risks.
A company can include the risk of inflation into its budget planning which changes the capacity to fluctuating demand. Cash flow is the movement of money in and out of the business (Hopkin, 2010). The risk in cash flow is the danger of receiving less cash than required however, the risk that a company's available cash will not be sufficient to meet its financial obligations.
Reference
Crouhy, M., Galai, D., & Mark, R. (2000). Risk management. New York: McGraw Hill.
Holmes, A. (2002). Risk management. Oxford, U.K: Capstone Pub.
Hopkin, P. (2010). Fundamentals of risk management: Understanding, evaluating, and implementing effective risk management. London: Kogan Page.
