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Does Your Company Need a Corporate
Risk Assessment of Critical Processes?
How Would Your Organization
Score in the Areas of:
- Financial
- Operations
- Information Technology
- Administration and Human Resources
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In Applying the Risk
Assessment Approach, Moore Colson:
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Understands your business
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Develops an interview structure,
plans and performs interviews
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Summarizes results from
interviews
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Communicates the risk assessment
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Are Your Critical
Processes Headed for Failure at Your Organization?
Situation:
A rapidly expanding company with approximately $250 million in
revenues determined that its overall corporate governance strategy needed
to be enhanced by implementing an internal audit function. The company
evaluated and determined that outsourcing the internal audit function
would provide greater depth and flexibility regarding resource utilization
and specialized knowledge, such as information technology security.
Action:
Moore Colson consulted with senior management to create a strategy for
internal audit implementation. An enterprise-wide risk assessment was
performed by Moore Colson to provide senior management and the Board of
Directors with the information necessary to determine the scope of the
internal audit function within the organization.
Moore Colson interviewed senior management and operational management
for the purpose of identifying critical processes in the organization.
Once identified, each critical process was assessed as to its “likelihood”
and “consequence” of failure, and a “risk score” was determined. Critical
processes were ranked by “risk score”, creating a prioritization of
processes to be tested by internal audit. Moore Colson met with the Board
of Directors to review the risk assessment and related observations.
Result:
From this process, the company was able to clearly define its internal
audit function and develop an immediate action plan for review of internal
controls and operations. The company’s overall corporate governance
strategy was enhanced, and the CEO and the Board of Directors gained
immediate feedback regarding the adequacy of internal controls overall
critical processes through direct communication with the internal audit
team.
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Internal auditing is
an independent, objective assurance and consulting activity designed to
add value and improve an organization's operations. It helps an
organization accomplish its objectives by bringing a systematic,
disciplined approach to evaluate and improve the effectiveness of risk
management, control, and governance processes.
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