In: Accounting
Elaborate 5 (FIVE) methods of managing risks for finance/accounting profession in different industries during this pandemic situation.
solution:
1. Accept Risk: Individual option that an accounting and finance team advances have is that they pleasure only recognize the pandemic and the hazard it is growing up with. They will have to decide whether the danger is possibly effective also if there is any necessary to act. The accounting and finance unit will bear the danger and both the experience of it is little or its influence on the firm continues minor which makes the organization accept it and neglect it without taking any additional action. The organization goes by the logic of " Do Nothing" and is happy with the status quo.
2. Minimise risk: Frequently, this is the common used risk management policy where in an organization wherein the action is needed or charge actions are put in place so that danger is restrained to an adequate level. In the case of the accounting or finance profession, the decrease hazard would be to guide the company on which investments to maintain and which one to leave.
3. Share risk: Hither what an organization does is that it determines partners that it shares this danger with and by having more partners on board, it can move from their knowledge, technology and other expertise and through reducing the risk. In the event of the accounting and finance profession, the best Share risk procedure would be to cooperate with one accounting and finance firm such as KPMG, Deloitte, Ernst & Young, PricewaterhouseCoopers. The aim is to decrease the hazard by sharing it, various project members into collaboration. Hereabouts what the partner company does is to receive all or part of the hazard of the project.
3. Transfer risk: Meanwhile the danger of the possibility of the existence of risk is very cheap but the possible result is very large, the best procedure is to shift the danger. It is utilized when the organization is unable to change the nature of risk unless through avoidance or minimization, it is sensible to shift the risk to the third parties. In the case of the accounting or finance profession grappling with a pandemic, the most suitable alternative would be to have insurance policies for all employees.
4. Avoidance risk: If the danger is too high to accept, the better procedure would be to bypass the risk. It means not allowing for those actions that might cause the danger. This is the most proactive form of risk management approach. In the case of the accounting and finance profession faced with a pandemic, the possible strategy may be to finish office work so that no one consumes the virus.