Determining the Effectiveness of Internal Controls in Enterprise Risk Management based on COSO Recommendations

2019 ◽  
Author(s):  
Thabit Thabit
Keyword(s):  
Risk Management ◽  
Internal Controls ◽  
Enterprise Risk Management ◽  
Enterprise Risk

Tesco Accounting Misstatements: Myopic Ideologies Overshadowing Larger Organisational Interests

2016 ◽  
Vol 7 (1) ◽  
pp. 9
Author(s):  
Gagan Kukreja ◽  
Sanjay Gupta
Keyword(s):  
Risk Management ◽  
Corporate Governance ◽  
Control Systems ◽  
Internal Controls ◽  
Enterprise Risk Management ◽  
Reporting Standards ◽  
Management Change ◽  
The People ◽  
Enterprise Risk

This case study explores what went wrong in Tesco that resulted in the fraud of accounting misstatements of the magnitude of £263 million, why the fraud remained undetected over a number of years, which resulted in catastrophic consequences for both Tesco and its stakeholders. Furthermore, it highlights the lessons learnt from this debacle in Tesco, with focus on enterprise risk management, change management, corporate governance, materiality of transactions from accounting perspective, auditors' independence, sound accounting practices, internal controls and, employees' incentives policies. Finally, while the ultimate price of these scandals is paid by the society at large - particularly stockholders who put their hard earned savings in these institutions just on the basis of their trust on them - and while such scandals are often attributed to gaps in internal controls and auditors' negligence, this study concludes that, whatever controls are put in place or whatever accounting and reporting standards are set, if the people who are the part of system themselves decide to bypass the control systems, it is next to impossible to prevent such fraudulent activities. This case study has been prepared for educational purposes based on public available sources such as newspapers, magazines, websites and other referred articles.

scholarly journals Using Identity Theft To Teach Enterprise Risk Management Make It Personal!

2008 ◽  
Vol 4 (6) ◽  
pp. 43-50 ◽  
Author(s):  
Norma C. Holter ◽  
W. Michael Seganish
Keyword(s):  
Risk Management ◽  
Balanced Scorecard ◽  
Identity Theft ◽  
Internal Controls ◽  
Enterprise Risk Management ◽  
Organizational Strategies ◽  
Business Policy ◽  
The Balanced Scorecard ◽  
Real Risk ◽  
Enterprise Risk

This article introduces an innovative way to teach the Enterprise Risk Management (ERM) Integrated Framework (as developed by COSO), while at the same time informs the student of a real personal risk -- identity theft. This example of assessing and managing a real risk will enhance the students understanding of risk management, thereby increasing the skill set of the student. The student who gains an understanding of the ERM concepts can then apply this tool to all of the disciplines of business. The ERM framework can be tailored to any discipline, as shown by the following examples: presented in connection with the Balanced Scorecard; evaluating different organizational strategies in a Business Policy class; case analysis in Management or Marketing (particularly a new product or new market); in an Auditing class with discussion of internal controls; in Finance to evaluate the decision to invest in derivatives or capital project, and in an Entrepreneurship class.

The Impact of Enterprise Risk Management on the Audit Process: Evidence from Audit Fees and Audit Delay

2017 ◽  
Vol 37 (3) ◽  
pp. 25-46 ◽  
Author(s):  
Cristina Bailey ◽  
Denton L. Collins ◽  
Lawrence J. Abbott
Keyword(s):  
Risk Management ◽  
Audit Fees ◽  
Internal Controls ◽  
Enterprise Risk Management ◽  
Data Availability ◽  
Audit Process ◽  
Enterprise Risk ◽  
Stage Analysis ◽  
The Impact ◽  
Jel Classifications

SUMMARY Prior research examining enterprise risk management (ERM) focuses mainly on entity-level measures, relying heavily on the link between ERM and internal controls. We argue that auditors leverage the client's ERM system at the application level to create audit efficiencies beyond those created by strong internal controls. Using a Heckman two-stage analysis for our sample of insurance/reinsurance firms rated on ERM quality by Standard & Poor's, we find results consistent with our expectations that higher-quality ERM systems incrementally reduce audit fees, audit delay, and the likelihood of late filing. However, we find that this association is nonlinear and that much of the assurance benefit from ERM systems is captured when firms improve their ratings from Weak to Adequate. JEL Classifications: G22; M41. Data Availability: The Standard & Poor's data on ERM quality is available at: http://www.standardandpoors.com/ratingsdirect/.

Effect of Enterprise Risk Management on Firm Value: Empirical Evidence from Non-Financial Firms in Pakistan

GIS Business ◽  
1970 ◽  
Vol 13 (2) ◽  
pp. 15-28
Author(s):  
Nouman Nasir
Keyword(s):  
Risk Management ◽  
Firm Value ◽  
Positive Impact ◽  
Stock Exchange ◽  
Enterprise Risk Management ◽  
Least Square ◽  
Return On Equity ◽  
Financial Firms ◽  
Enterprise Risk ◽  
Ordinary Least Square Regression

This research examines the effect of enterprise risk management on firm value in Pakistan. Further, this study empirically examines company characteristics that establish the execution of an enterprise risk management system. Using a sample of final dataset of 83 non-financial firms located in Pakistan. The sample included non-financial firms from the year 1999 to 2015 and so up to seventeen observation years per company. As in context of Pakistan, most of the organizations are already implement an ERM programs and establish specialized ERM departments because the ERM is now a global term and has become increasingly relevant because of the growing difficulty of risk and an additional development of regulatory frame works. For the empirical evidences, data collected from non-financial firms listed at the Pakistan Stock Exchange (PSX). Results of logistic regression shows that Capital Opacity, Profitability, Financial Leverage, Firm Size and Slack have positive impact on the implementation of an ERM system but Industrial diversification, Industry and Return on Equity are negatively related to an ERM engagement. The results of ordinary least square regression finds positive relationship between use of an ERM and firm value.

MODELLING AND CONTROLLING THE ENTERPRISE RISKS COMPLEX ASSESSMENT SYSTEMON THE BASIS OF RUSSIAN STATE STANDARD ISO 9001-2015 CONCERNING RISK-ORIENTED THINKING. GENERAL PROBLEMS AND WAYS OF SOLVING THEM

2020 ◽  
Vol 2020 (2) ◽  
pp. 33-41
Author(s):  
Irina Merzlyakova ◽  
Aleksandr Feofanov
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
State Standard ◽  
Control Model ◽  
Enterprise Risk Management ◽  
Iso 9001 ◽  
Management Procedure ◽  
Russian State Standard ◽  
Russian State ◽  
Enterprise Risk

The article considers general problems of implementing the enterprise risk management procedure. One of the ways to solve the problems arising when meeting Russian state standard ISO 9001-2015 requirements concerning risk-oriented thinking is presented. A risk assessment control model aimed at coordinating all kinds of the enterprise departments activities, forming a clear algorithm of risk management procedure implementation and attracting a greater number of employees towards this activity is offered.

Firm Ownership and Enterprise Risk Management: Evidence from a Developing Country

2020 ◽  
Vol 24 (02) ◽  
pp. 3679-3689
Author(s):  
Ooi Chee Keong ◽  
Abdurrahman Adamu Pantamee ◽  
Shafi Mohamad ◽  
Kwong Wing Chong Garrett
Keyword(s):  
Risk Management ◽  
Developing Country ◽  
Enterprise Risk Management ◽  
Firm Ownership ◽  
Enterprise Risk
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