1. Enterprise Risk MANAGEMENT workshop by Hadeel NASSAr (Facilitator)
Based on
THE MASTER GUIDE TO
CONTROLLERS’ BEST PRACTICES
by IMA

3. Enterprise Risk Management is a process, effected by entity's board of directors, management and other personnel, initiated in strategy setting spread across the entity, to identify the potential risk that may affect the enterprise and control the risk to be within in the entity’s risk appetite and provide reasonable assurance on the achievement of the organizational objectives.

4. Objectives Learning Risk management in interactive session!
To learn and explore:
Risk management definition/s
Risk main concepts (appetite, residual, inherent…etc.)
Risk categories
Factors that may create the risk
Types of risk
Risk management models
Considerations

5. Enterprise Risk management definition/s
The Committee of Supporting Organizations of the Treadway Commission (COSO) defines Enterprise Risk Management as follows:
Enterprise risk management is a process, effected by an entity’s board of directors, management, and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives.

6. ERM main concepts Now the BIG FUN Starts
Risk assessment
Risk response
Appetite
Residual
Inherent

7. Risk categories
The Association of Financial Professionals (AFP) conducted a survey in October The responses came from 435 finance professionals, across North America.
Financial Risk (credit, liquidity, interest rate, currency/FX) 72%
Macroeconomic Risk (GDP growth, inflation) 38%
Business/Operations Risk (supply chain disruptions, production interruptions, litigation, labor, outsourcing, IT) 36%
External Risk (country risk, regulatory, natural disaster) 37%
Commodities Risk (power and heat, crude oil & distillates, agricultures, metals) 22%

8. Factors that may create the risk
When developing a risk management plan, a controller should consider factors that may create risk, These factors are:
Inadequate management reporting and monitoring
Inadequate financial performance metrics
Operational issues due to poor internal controls
Legal and regulatory violations
Incorrect financial reporting due to management overrides or fraudulent activities
Excessive bad debt and inventory write-offs
Internal and external fraud
Breaches in confidentiality
Lack of quality control
Lack of business continuity plan

9. Types of risk Operational risk Financial risk Fraud risk Market risk
Credit risk
Commodity risk
Currency risk
Project risk
Technology and software risk

10. Risk management models
The Deming Cycle

11. Risk management models
ISO 31000:2009

12. Risk management models
The committee of Sponsoring Organizations of the Treadway Commission (COSO) Enterprise Risk Management (ERM) Model

13. Considerations Internal Environment Information and communication
Risk Solutions, LLP has developed the following checklist to be considered when implementing an ERM approach to managing risk. ERM aims to promote informed business decisions by evaluating total returns relative to total risks.
Questions that should be asked when assessing as organization’s ERM strategy are as follows:
Internal Environment
Information and communication
Objective Setting
monitoring
Event Identification
Risk Assessment
Risk Response
Control Activities

14. Risk management (END)
ERM and IMA (CMA) 7 minutes video