Skip to main content

How financial risk affect financial management decisions

Yes, risk management is a part of decision making. When an organization takes any decision about capital budgeting, capital structure, and working capital (very important effective decision) they should avoid all the financial risky factors. It's a process with imagination, creativity and understanding of human behavior. The whole process is covering a number of intangible & tangible factors affecting the decision process.

In my previous post I discussed about e finance which is a part of e-commerce. I have
Shown how e-finance is effecting our lifestyle, (e-banking, online shopping , using credit card through online, etc…) But to run Business these all can be a very risky factor.

Types of risk:

financial risk

So we have to analyze the risk. This consists of Source analysis and Problem analysis.
It may be external or internal to the system which the main target of risk management.
Examples of risk sources are: employees of a company, stakeholders of a project.

The risks are related to identify threats. For example: the threat of losing money, the threat of abuse of privacy or risk of accidents and casualties. Threats can be with various entities, like customer, share holders, & legislative bodies like the government

Risk identification is another main factor which really affects financial management decisions. Maximum project lead or organization (not for those who have already implemented their system) head unable to identify the risk because each & every body are depending on the system. They should know the scammers are always ready to give a big bouncer.
I'd like point out to the common risk identification method:risk identification









Risk management is a important part of finance. Without it nobody can take a proper decision to run his business.

The areas of risk management are:
• Risk management and business continuity
• the risk communication
• Benefits of Risk Communication

Apart from that there is some other risk which is related to computer.

• Data integrity
• How the scammers/ hackers are getting in
• how to manage the illegal entries

These all are really affects to take a financial management decision. But decisions solve problem but besides that they arise another problems.

Related Article:


Just look at this vedio..... Its a good example
Labels:

Comments

Post a Comment

Popular posts from this blog

3 Attributes That Must Be Known before Installing Business Phone Systems

For most associations, all-inclusive most imperative bit of office gear is the phone. Business Phone Systems typically begin fetching a couple of thousand dollars, and the value builds relatively to the measure of the framework and number of characteristics that you need. Imperative attributes are discussed below.   Attribute-1  What Features are required?  The characteristics that carry quality to your business and associate your business to the planet are set to build the sum expense of the Business Phone Systems. The selling specialist will attempt to offer every one of you the extravagant accessories (that is their occupation), yet you have to take a gander at each one characteristic and choose when it will add quality to your business or recovering you cash.
Post a Comment
Read more

Know Your Car Insurance Need for Safe Bet

Own a classic car in The United States of America? Then it would not be tough to understand why auto insurance is so crucial to operate a car there. You would see people traveling in cars, Small utility vehicles, minivans, and sports coupes a lot. That is the reason every car buyers are so interested in collecting the information on types of car insurance. Once you know the types of car insurance it is needed to find a credible insurance agent. Investigating this through family and friends can be a good idea. Referrals can also do wonder to make final decisions. Type of Car Insurance * Bodily Injury Liability : As a driver Liability insurance coverage is very crucial. This insurance covers any injuries or damages to property that may occur during an accident. Bodily injury liability insurance and property damage liability insurance these are two types of liability insurance. It does not cover your vehicle, you or other people on your policy. It takes into account covera...
Post a Comment
Read more

Commercial Mortgage Backed Securities

The term commercial mortgage backed securities is quite familiar in American security market. Securities of such type of that are secured by loans on business properties are commonly known as CMBS , the abbreviated form. With so much sites crowding on the net, we have become quite aware of commercial mortgage as well as commercial remortgage. They do not differ much from residential mortgage or remortgage. In case of commercial mortgages or remortgages, commercial property instead of residential property is used as collateral to secure a loan. Moreover, the rate of interest is also higher, in case one wants to use his commercial property. In recent years, we have witnessed a step rise in the prices of residential as well as commercial property. With immense possibility of continuous increase in real estate prices in future, commercial mortgage backed securities is more and more adopted by the lenders. In case of both residential and commercial mortgages, one needs t...
Post a Comment
Read more