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Operational and Financial risk
Operational and Financial Risk BDO reported 1 billion worth of fraud in 2005 ,compared to 331m in 2003,confirmed by KPMG findings HRA has identified that where there is cash trade the probability of risk is higher. Operational risk is a permanent crime that goes undetected, often unidentified,due to the level of trust and learning culture that the company enforces among the operational staff , by the internal audit team over a period of time Financial Risk While operational risk increases arithmetically, financial risk increases geometrically HRA defines Financial risk as 10 times greater than Operational Risk. HRA describes a ten thousand service charge fraud as sixty thousands in sales value and recommneds Directors and Senior Management Team to review Fraud Reporting Techniques . HRA defines a 2.5k risk as equivalent to 2.5 million in sales value and recommends recovering such fraud through POCA and MLR to stop futher losses arising from similar practices. HRA recognises the need of a Forensic intelligence Team, innovative Operational and Financial auditing techniques to reduce these types of operational risks.They tend to repeat continuosly in hotels and restaurants. HRA will audit current systems and procedures ,report its findings and recommend the best operational risk management technique HRA recognises that Frauds arising from serious regulatory breaches, are relatively rare, and can have serious financial risk as defined by the formula one times ten Enron, WorldCom and others are good few examples. The frauds reported in the Caterer, at Hilton, for payroll and commission, Marriott for service charge, are just few reported frauds where the criminals have been successfully prosecuted HRA recognises that Forensic intelligence, Operational , Financial and Revenue auditing techniques reduce these high critical but low probability risks. HRA assist companies in identifying the root causes of cash flow crisis,operational and financial risk and establish a change management programme that streamline the internal business processes and creates sustainable growth and profitability HRA will audit your systems and procedures and recommend appropriate risk management technique. HRA develops strategic partnership with clients to prevent, identify, audit , recover the proceeds from crime act with the objective to improve operational and financial performance. |
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