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Paper Topic:

risk management categories

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Risk Management Categories

Risk management is defines as established corporate governance features which are shaped in several areas which are based on current practices with regard to investment appraisal , project , and health safety management are defined to be lacking integration and common guiding principles in the scheme of consistency in standards or coverage . The coverage for risk management mainly revolves around contracts obligations , commitments , and agreements - which by hand gives ample importance in any organization

's exposure to the managerial world Consequently , risk facing firms are pervasive and that the recognition of this fact as well as with the necessity of handling the risks require outspoken and consistent support ADDIN EN .CITE MarrisonChristopher MarrisonThe Fundamentals of Risk Measurement1st2002New York NYMcGraw-Hill (Marrison

Further , it is fervently stressed that the remarkably obliged risk officers of an organization are the CEOs given the fact that executives are entitled for other technical duties and that risk management is mainly a protocol in a profession with conceptual skill as the main function . Strategic aspects on risk management are expected to be utilized towards the actual variation of outcomes that are anticipated ' - if risk management is not analyzed and comprehended in the most definitive mean , then there is a large expectation of constant loss

Risk avoidance is also coined as risk elimination this type of risk management is an act by which one prefers not to perform an activity which is predicted to have a negative result . Moreover , much of the academic research and existing literature on the performance of assets the assumption is made that this is , indeed is an important implication of this assumption that , given fairly reasonable assumptions about risk avoidance by investors , the optimal allocation of funds across various asset classes will be the same regardless of the investor 's time horizon for his investment ADDIN EN .CITE Galai20052 226Dan GalaiRobert Mark Michel CrouhyThe Essentials of Risk Management1st2005New York NYMcGraw-Hill (Galai , Mark and Crouhy

Hence , risk reduction on the other hand , is characterized as a method used to drive away from the probability of having a severe loss . In the case of accountants , however , debate whether risk reduction is required on a transaction level , an enterprise level or at an operating unit level to achieve special accounting for the hedge instrument . If enterprise-wide risk reduction were a requirement for hedge accounting the hedger would have to make an assessment of the incremental effect of the hedging instrument on a company-wide basis . Risk retention is perhaps this form of risk management tool connotes the idea that what has been lost must be accepted inasmuch as the verity of self-insurance ' is served . In most cases , risk retention gives the viable strength wherein small risks are nevertheless made coherent with the assurance that the risk incurred would be better in due time and that the losses made can be persistent

Most efficient risk management tool

There has been substantial growth...

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