The COSO Framework for Internal Control
February 12, 2025
What is Insider Trading ? In recent years, there has been a string of high profile convictions in the United States as part of the crackdown against insider trading. This has resulted in lot of media attention being given to the issue of insider trading. Before we launch into a fully-fledged discussion of the intricacies […]
A strong bond between two or more people refers to interpersonal relationship. Attraction between individuals brings them close to each other and eventually results in a strong interpersonal relationship. Forms of Interpersonal relationship An interpersonal relationship can develop between any of the following: Individuals working together in the same organization. People working in the same […]
Various organizations have laid down principles for risk management. There are risk management principles by International standardization Organization and by Project Management Body of Knowledge. The Project management body of knowledge (PMBOK) has laid down 12 principles. This article carries an amalgamation of both PMBOK and ISO principles. The various principles are: Organizational Context: Every […]
Communication is neither the transmission of a message nor the message itself. It is the mutual exchange of understanding, originating with the receiver. Communication needs to be effective in business. Communication is the essence of management. The basic functions of management (Planning, Organizing, Staffing, Directing and Controlling) cannot be performed well without effective communication. Business […]
Communication plays an important role in the success and failure of an organization. The art of expressing one’s ideas and thoughts clearly is called as effective communication. Individuals need to communicate effectively at the workplace for better transparency and clarity. Not only effective communication helps in correct transfer of information but also in decision making. […]
There is an old saying in management that “whatever gets measured gets managed”. This is truer in the case of risk management. Important data pertaining to risk is often scattered at different places within the organization. This is the reason that there is always a need for an information system that can serve as an integrated platform where information related to risk is maintained. There are many organizations in the world, who have developed these types of information systems. They are known as risk management information systems.
Just like other software solutions, the risk management information system is location agnostic. This means that users can access this system from any location and at any time. It is also important that the risk management information system is tailored to meet the specific needs of the organization.
There are some unique features that define a risk management information system. Some of them have been listed below:
At its most basic level, the risk management information system is an incident reporting tool. Using this tool, incidents related to risk are reported. This triggers notifications to all related stakeholders who are then able to manage the resultant claims and risks.
A risk management system is designed based on the risk policy of the organization. It provides a central dashboard wherein the risk position of the company can be known at any given time. It is common to compare this position with the desired position of the company and to take decisions accordingly.
A risk management information system should be capable of collecting data automatically. The whole point of having an information system is that the data is scattered all across the organization. Hence, collecting data tends to take a lot of time. Automatic collection and presentation of data in the right format help make quick and effective decisions. It is a known fact that quick decisions are vital in risk management.
The bottom line is that the concept of risk management largely relies on timely decision-making. Now, decisions can only be made if there is information available that helps to understand the consequences of such decisions. This the reason that risk management information systems have become vital to ensure the smooth functioning of a risk management team.
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