The *probability of the occurrence of an event with negative consequences. The IIA defines risk as "the probability that an event or action, or inaction, may adversely affect the organization or activity under review" (quoted in Hermanson and Rittenberg, 2003, 35). Risk leads to Opportunity costs as well as traditionally understood *costs, and it can be quantified in terms of (i) likelihood of occurrence and (ii) financial or operational outcome. While some risks can be quantified only with difficulty, they can at a minimum be categorized as high, medium, or low, in terms of both likelihood of occurrence and financial or operational outcome. Risks are often interpreted as potential barriers to the achievement of the objectives or goals of an activity or organization. Typical areas of risk in modern organizations include the following: (i) strategic and *planning risks, (ii) *fraud, (iii) *credit risks, (iv) operational risks (including health and safety concerns), (v) legal matters, (vi) *regulatory risks, (vii) accounting risks, (viii) technological risks (including the *obsolescence of manufactured products), and (ix) *treasury risks. Many of these risks are not stand-alone items, as their interrelations can be complex. A study by the Institute of Internal Auditors (IIA UK, 1998, section 2.2) identified three underlying primary causes of risk: (i) the random nature of events, (ii) imperfect or incomplete knowledge, and (iii) lack of *control. See also (in addition to the dictionary’s entries that begin with the word risk) *absolute risk, *audit risk, *Control Risk Self Assessment, *credit risk, *enterprise risk management, *interest rate risk, *portfolio risk, *reputation risk, *sampling risk, *systematic risk, *uncertainty and *unsystematic risk. Further reading: Bernstein (1996); Doherty (2000); IIA UK (1998)

Auditor's dictionary. 2014.

Игры ⚽ Поможем написать реферат

Look at other dictionaries:

  • Risk — takers redirects here. For the Canadian television program, see Risk Takers. For other uses, see Risk (disambiguation). Risk is the potential that a chosen action or activity (including the choice of inaction) will lead to a loss (an undesirable… …   Wikipedia

  • Risk — Saltar a navegación, búsqueda Para otros usos de este término, véase Risk (desambiguación). Risk Partida de Risk en curso. Autor: Albert Lamorisse Editor …   Wikipedia Español

  • risk — n 1 a: possibility of loss or injury b: liability for loss or injury if it occurs the risk of loss passes to the buyer when the goods are duly delivered to the carrier Uniform Commercial Code the risk of personal injury and property damage should …   Law dictionary

  • Risk! — Risk Pour les articles homonymes, voir Risk (homonymie). Risk jeu de société [[Fichier:|280px]] Une partie de …   Wikipédia en Français

  • Risk — Risk, v. t. [imp. & p. p. {Risked}; p. pr. & vb. n. {Risking}.] [CF. F. risquer. See {Risk}, n.] 1. To expose to risk, hazard, or peril; to venture; as, to risk goods on board of a ship; to risk one s person in battle; to risk one s fame by a… …   The Collaborative International Dictionary of English

  • risk — ► NOUN 1) a situation involving exposure to danger. 2) the possibility that something unpleasant will happen. 3) a person or thing causing a risk or regarded in relation to risk: a fire risk. ► VERB 1) expose to danger or loss. 2) act in such a… …   English terms dictionary

  • risk — [risk] n. [Fr risque < It risco, risico < risicare, to risk < VL * risicare] 1. the chance of injury, damage, or loss; dangerous chance; hazard 2. Insurance a) the chance of loss b) the degree of probability of loss c) the amount of… …   English World dictionary

  • Risk 2 — Risk II Risk II Éditeur Hasbro Interactive Développeur Deep Red Games Date de sortie Mars 2000 Genre Stratégie au tour par tour Mode de jeu Un joueur, mul …   Wikipédia en Français

  • Risk — студийный альбом Megadeth …   Википедия

  • Risk — (engl. für „Risiko“) bezeichnet: Risk (Band), eine deutsche Power Metal /Thrash Metal Band Risk – Mörderischer Einsatz, einen Bollywood Film von 2007 einen Superhelden der Teen Titans Risk ist der Titel mehrerer Musikalben: 1999 von Megadeth,… …   Deutsch Wikipedia

  • risk´i|ly — risk|y «RIHS kee», adjective, risk|i|er, risk|i|est. 1. full of risk; dangerous: »It s a risky thing getting mixed in any matters with the like of you (John M. Synge). SYNONYM( …   Useful english dictionary

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”