What is Risk Analysis? Risk analysis is the process of assessing the likelihood of an adverse event occurring within the company. Risk analysis is the study of the underlying uncertainty of a given course of action and refers to the uncertainty of forecasted cash flow streams, the variance of portfolio or stock returns, the probability of a project’s success or failure, and possible future economic status. Process of Risk Analysis: STEP 1: Identification of Risk STEP 2: Analyzing the Risk STEP 3: Evaluating
What are Internal Financial Controls? Internal financial controls mean policies and procedures adopted by the company for ensuring: Orderly and efficient conduct of its business, including adherence to the company’s policy and procedure,Safeguarding of company’s assets,Prevention and detection of malpractices, frauds and errors,Accuracy and completeness of accounting records andTimely compliance with various statutes andTimely preparation of books of accounts It includes policies and procedures adopted by the company for ensuring the orderly and efficient conduct of business, including regulatory compliance and prevention and
Business organizations today are very vast and complex. If keeping track of their daily activities itself is a challenge, managing their daily activities is an even greater challenge. Numerous transactions happen, new clients are acquired, additional engagements with existing clients are commenced, contracts are renewed/terminated as well as payments are received and made, on a daily basis. A large number of employees – having diverse character, age experience etc.- join; employees leave, take casual leaves and change roles every day.
As the old verse goes, “make new friends, but keep the old. One is silver while the other is gold”. It is well recognized that this applies to the business domain as good as it applies to the personal domain. And, Financial Accounting Outsourcing (FAO) industry is no exception. Perhaps, it is more relevant in such domains which are highly competitive and where the life time value of one single client can potentially have significant influence on the value created
Handling accounting and finance is a key function for any business organisation, at all times. Unless your company is operating in the Finance domain, you are likely to find it difficult to handle the nitty-gritty of accounting and finance. Many companies prefer to outsource their financial accounting tasks to professional organisations offering such services rather than setting up internal teams. The company to which one company outsources its financial accounting operations is called that company’s Finance and Accounting Outsourcing (FAO) partner. There is
As the role of most other corporate positions have changed and evolved with the passage of time and changing business environment, the CFO role has changed and evolved too. Traditionally, the CFO was considered as the ‘head bookkeeper’ of the organization, who was responsible for collation of data, preparation of reports and handing them over to the CEO. However, that is not the case anymore. The Chief Financial Officer (CFO) is now regarded to be almost as valuable as the
“If you deprive yourself of outsourcing and your competitors do not, you are putting yourself out of business.” – Lee Kuan Yew Rapid globalization, technology advancements and the availability of quality manpower have driven the growth of Financial Accounting Outsourcing (FAO) industry; today, it is well-established and matured. The advantages of FAO have far outgrown cost arbitrage and improved efficiency now, to encompass agility and strategic advantage among others. However, the critical decision of whether to outsource the F & A function or
Meticulous accounting of revenues and expenses as well as proper management of finances are crucial activities for any business organization. Statutory and legal compliance is also vital for the survival and growth of organizations. As hiring, training and maintaining a good in-house Financial Accounting (F & A) department is expensive and time consuming, a large number of companies opt for the outsourced Financial Accounting model these days. F & A used to be a rather simpler activity earlier. However, with