In today's business environment tax risk is one of the more challenging business risks
presenting both monetary and reputation consequences for corporations.
Protiviti, a leading internal audit and risk consulting firm, has introduced two advanced technology solutions that it says will help its clients better identify, evaluate and manage their business risks
The solution is facilitated by using workshops with employees from different areas to identify business risks
The company has formed a Business Risk
Advisory Committee, which serves as the forum for reviewing selected business risks
as they emerge.
But few have stopped to consider whether business risks
- which may have a far greater impact on shareholder value - can be transferred to a third party in the same way.
Business leaders are asking why business risks
of all types, not just financial risks, are causing trouble more often today.
Besides assessing the entity's and the auditor's business risks
, the auditor sets planned audit risk.
In the process, we have created a model that we apply to business risks
in three areas - environmental, process, and information for decision making - that affect the company as a whole or some specific process.
Sales and earnings trends are affected by many factors including, among others, our entry into an effective distribution agreement with one or more wholesale food brokers or large-scale retail outlets, the effectiveness of our promotion and merchandising strategies, the efficient operation of our production facility and supply chain, the changing dietary and culinary habits of consumers in our target markets, and our effective management of business risks
Have we evaluated all business risks
and their potential impact?
For example, Tosco's Linden, New Jersey, refinery could be considered the top risk area in the company based on the volume of its operations and the money While some internal auditors might audit the total refinery, "I am interested only in certain business risks
within that operation," Marks says.
As to results presently deemed achievable for the fourth quarter, sales and earnings trends are also affected by many other factors including, among others, world and national political events, general economic conditions, the effectiveness of our promotion and merchandising strategies, our ability to integrate and profitably operate acquired businesses, the efficient operation of our supply chain, including the continued support of our key vendors, our effective management of business risks
, including litigation, and competitive factors applicable to our retail and direct response markets.