Elements and Performance Criteria
- Assess financial risk exposure
- Magnitude and volatility of risks are measured to determine the extent of risk exposure and the implications for financial strategies
- Key factors supporting or driving risk exposure are identified and timeframes established to monitor and improve performance
- Short and long term financial outcomes and projections are compared with actual cash flows using standard financial analysis techniques to determine effects on liquidity and budget adjustments
- Develop risk management processes
- Risk management options include assessments of alternatives, criteria for success, and estimates of long and short term effects
- Strategies are developed using standard financial analysis techniques to identify financial flows, trends in returns and adjustments in asset values
- Financial recording systems are established to monitor and evaluate changes in market conditions and business needs using a range of data sources
- Risk management strategy optimises the mix of asset structures and liabilities in operations and ensures flexibility to meet changing environments
- Analyse financial histories
- Financial performance is evaluated using trends and patterns that identify the magnitude and volatility of financial exposures
- Long and short term financial outcomes are compared with forecasted outcomes to assess variances and parameters in performance and the reliability of financial advice
- Incidents and factors increasing or diminishing financial performance are identified and analysed using standard financial analysis techniques
- Establish processes to minimise risks
- Recording systems to monitor financial outcomes are developed and reviewed to guide and document decision making
- Inventories are maintained and established to ensure up-to-date records on the value of assets and liabilities
- The contribution of organisational attitudes to risk taking is assessed and incorporated in risk analysis process
- Parameters for variances in financial outcomes are developed, reviewed and communicated to support financial decision making