The Analysis And Identification Of Uncertainty And...

The analysis and identification of uncertainty and potential loss describe the fundamentals of risk management. Risk management became an objective for the study after World War II. The focus was on technological losses, operational, and political risks. After 1950s, risk management encompassed various market risks, financial, operational, and liquidity risks. The evolvement of risk management was due to regulatory changes, market fluctuations, and financial crises. Among significant events that influenced risk management were first stock derivatives in 1980s, the implementation of Basel I in 1988, first bankruptcies in 1994 (Procter and Gamble, Orange County, and Barings), Asian and Russian crisis in 1994, Enron bankruptcy in 2001, new rules of Sarbanes-Oxley in 2002, beginning of financial crisis in 2007, and new set of reforms announced in Basel III in 2010 (Dionne, 2013, pp. 3-6). Historically, the objective of risk management was to stabilize the company financial health, improve its capital structure, and establish strategies to prevent losses and financial crisis. Today, risk management requires more diligence, ethics, subjective knowledge, and independence. Companies adopt risk management policies due to complexity of financial markets, executives’ risk appetite, greater transparency with investors and rating agencies, and perceived conflict of interests. Purpose of Research and Research Question The purpose of this research is to analyze the effect of riskShow MoreRelatedThe Poor Quality Of Risk Management3062 Words   |  13 Pagesconsiderable amount of interest shown by the construction industry in terms of risk management techniques used. The significance of proper risk identification and management has reached across the broad underwriting lately, in that its essential in that amid the early phases of examination of the project. 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For any form of commercial exploitation distributionRead MoreCoso Framework3220 Words   |  13 PagesEnterprise Risk Management — Integrated Framework Executive Summary September 2004 Copyright  © 2004 by the Committee of Sponsoring Organizations of the Treadway Commission. All rights reserved. You are hereby authorized to download and distribute unlimited copies of this Executive Summary PDF document, for internal use by you and your firm. You may not remove any copyright or trademark notices, such as the  ©, TM, or  ® symbols, from the downloaded copy. For any form of commercial exploitation