IFAC Offers Advice on Risk Management

The International Federation of Accountants has released a new thought paper offering advice on risk management.

The document, From Bolt-on to Built-in, discusses how to manage risk as an integral part of managing an organization.

The paper positions risk management as an integral part of decision-making and execution to ensure an organization makes the best decisions and achieves its objectives. The paper also demonstrates the benefits of properly integrating the management of risk, including internal control, into the governance, management, and operations of an organization.

In addition, it provides ideas and suggestions on how such integration can be achieved; and provides practical examples of how business accountants can support organizations with this integration.

“This paper recognizes what risk management was originally intended to do for an organization—help support effective decision making and improve performance,” said IFAC CFO Fayez Choudhury in a statement. “Too many organizations don’t realize how useful risk management can be if integrated properly. Without this step—building risk management into your organization—too many management teams are missing the point, and missing the benefits.”

The thought paper applies to all organizations—regardless of size or structure, public or private—seeking to improve how they manage risk.