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Risk Assessment

Risk Assessment - the process of identifying, measuring, and analyzing risks relevant to a program or process

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anneliban499
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26 views

Risk Assessment

Risk Assessment - the process of identifying, measuring, and analyzing risks relevant to a program or process

Uploaded by

anneliban499
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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RISK

ASSESSMENTS

GROUP 1
Objectives

To define risk assessment To identify the process of To determine the


risk assessment importance of risk
assessment
Risk Assessment
- the process of identifying,
measuring, and analyzing risks
relevant to a program or process.
RISK ASSESSMENT
PROCESS
1st - Identification
of risk
Below are common risks that operational auditors
should consider.

Operational Risk Types


1. Capacity
2. Strategic
3. Compliance
4. Natural Environment
5. Political
2nd -
Measurement of
risk
The measurement process can be
either subjective or quantitative, and
either driven by facts or not.
• Risks are quite often measured using a three-point scale of
high-medium low or using a five-point scale, with likelihood
measures of rare-unlikely-possible-likely-almost certain.
Impact measure may include insignificant-minor-moderate-
major-catastrophic.
• Impact ratings can be expanded to provide more detailed
descriptions of each range, and may include variables such as
the degree of disruption to the organization, bodily injury to
workers and others, security, health and safety, social,
economic, and environmental
3rd - Assessing
Risks and Control
• Risk assessment is a process that
begins by identifying potential hazards
and analyzing those items to determine
what could happen if the hazard were
to occur.

• An important aspect of risk assessment


is identifying and quantifying the
assets that are at risk
Vulnerability
- is the “degree to which people,
property, resources, systems, and
cultural, economic, environmental, and
social activity is susceptible to harm,
degradation, or destruction on being
exposed to a hostile agent or factor.”
Two approaches of identifying the relevant
events.
1. Objectives Based - identify events that may hinder
the ability of the organization to achieve its objectives
partially or completely.
2. Scenario Based - create different scenarios or
alternative ways o f achieving objectives and
determine how forces interact.
Hazard Examples

Natural Floods, earthquakes, hurricanes, temperature, pandemic, and contamination

Human Unintentional: poorly operated equipment, unsafe work procedures, fatigue,


lack of training, and distractions

Intentional: workplace violence, strikes, arson, and fraud

Mechanical Poorly placed or installed equipment, outdated equipment, structural failure and
mechanical breakdown, and hazardous materials

Technology Loss of connectivity and corrupted data

Logistics Supplier disruption and transportation interruption


Importance of Risk Assessment
A risk assessment helps auditors identify
risks within the organization and allows
management and the board of directors to
develop adequate plans to mitigate those
risks.
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