Risk Services
Risk is one of the most often used buzzwords these days; however, risk is not a new concept, & strategy as well as cost / benefit to manage the risk must be weighed when making key decisions regarding risk!
Risk (defined by one source) is the potential of loss (an undesirable outcome, however not necessarily so) resulting from a given action, activity and / or inaction.
As defined by another source – A probability or threat of damage, injury, liability, loss, or any other negative occurrence that is caused by external or internal vulnerabilities, and that may be avoided through preemptive action.
Risk management plays an important role and can largely influence profitability.
- Risk Management (as defined by one source) – identification, analysis, assessment, control, and avoidance, minimization, or elimination of unacceptable risks. An organization may use risk assumption, risk avoidance, risk retention, risk transfer, or any other strategy (or combination of strategies) in proper management of future events.
- Enterprise Risk Management (ERM) as defined by the US ‘Committee of Sponsoring Organizations of the Treadway Commission’ (COSO) – “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 risks to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives.” COSO divides the ERM process into eight components: (1) internal environment, (2) objective setting, (3) event identification, (4) risk assessment, (5) risk response, (6) control activities, (7) information and communication, and (8) monitoring.
- Corporate Governance – opportunities generally exist to eliminate or mitigate risk and exposure – care should be taken to ensure exposure reduction is consistent and beneficial with the chosen strategy and risk appetite. Increased transparency and accountability plays an important role in achieving a positive impact.
Audit and Review Services
Refer to Audit and Review Services
Governance and Standards Compliance
We can assess and improve the governance structure by reviewing the control framework and recommending improvements where reasonable. We can perform vulnerability risk assessments, third party risk assessments, design and implement internal controls, review the monitoring system, review policies and procedures, etc., to ensure sound practices exist and are operating effectively and efficiently.
Risk Management
TLG Financial Consulting (TLG) will assist in creating and implementing a new framework or improving an existing management framework that makes sense for your company’s size and needs (one size does not fit all). We can assist with risk identification & perform training as necessary. We can assess the effectiveness of your risk mitigation control framework by mapping controls, flowcharting the process, reviewing the cost / benefit and making recommendations to add or streamline controls as necessary. We will also assist in implementing reporting and monitoring tools. One of our goals is to reduce the number of manual controls and increase the use of more effective and efficient system controls (preventative controls where feasible). The goal is to minimize downside risk and maximize upside risk. TLG will:
- Perform or assist with planning and preparation
- Create / Implement or assist with the framework
- Perform or assist with risk assessments & risk analysis
- Perform or assist with inventorying risk responses
- Implement or assist with risk-response monitoring
Segregation of Duties (SOD) including IT
We can review and assess company-wide SOD to ensure adequate protection exists which includes a proper segregation of duties in all key areas – we will also perform both physical and system access control testing to ensure adequate SOD.
Securities Exchange Commission (SEC) and Initial Public Offering (IPO)
TLG will assist with IPO readiness including ensuring the internal control structure is effective.
Whistleblower Reporting Program
Approximately 43% of employee fraud is discovered through an anonymous hotline. TLG can help implement an effective whistleblower program to assist with issue identification and resolution. Effective whistleblower programs can eliminate / reduce negative exposure and financial and/or legal risk. A discreet whistleblower program should include the use of a call-in service (telephone), an e-mail option, and a secure web submission program – TLG recommends all three alternatives should be utilized.
Regulatory Risk
Can lead to legal exposure including significant fines, penalties, etc. TLG can assist in ensuring your compliance functions are robust and operating effectively to reduce exposure. An effective internal control structure is an absolute must.
Fraud Risk
A preventive anti-fraud program is critical for addressing fraud concerns. We can implement or assist with a robust program including fraud deterrence & detection programs. We can also assist with SAS 99 – Consideration of Fraud in a Financial Statement Audit – the same concepts can be applied in an Internal Audit Function. Please see Financial Advisory Services tab as well!
Ethics and Integrity
A staple for eliminating or mitigating risk exposure. We can assist with implementation of a robust Ethics / Integrity Function including a whistleblower / hotline program discussed above. We can create or assist with ethics policies and procedures, and help design an effective “Ethics Committee” reporting function.
Operational Risk
TLG can assist with vendor related risks (e.g., RFP, Proposals, Bids, Tenders, Supply Chain – Right to Audit Clauses, etc.) by evaluating the processes and procedures in place, identifying gaps, assessing whether they are operating effectively as designed and ensuring a proper monitoring and reporting process exists. We can perform audits, reviews, risk assessments, vendor / third party audits / reviews, specific consulting procedures, etc.
Financial Risk
TLG will review the credit risk policies and procedures and ensure an adequate robust process exists. We will also review the Accounts Payable and the Accounts Receivable processes to ensure they are operating effectively and in the company’s best interest (e.g., ensuring proper discount treatment, adequate monitoring and follow-up processes exist, terms & conditions are met, etc.). We can streamline and improve the processes to help ensure maximum benefits are received.