To: Mr. A. CEO – Canadian Wood Toys INC.
From: … CAE – Canadian Woos Toys LTD
Date: October 05, 2014
Subject: Identify the risks and solutions to mitigate the risks
I will begin by highlighting the importance of the audit in assessing the risk and identifying the steps in reducing and mitigating the risk that our company is facing.
The impact of the risks on global business it is dramatic in our days, changing the entire look of the industries and financial services. Some risks could be anticipated and identified but some could not. Companies now are using more and more key steps and principles to better manage the risks by;
*** identifying the risks relevant to the organization
*** assess the significance and implications of those risks to the business
*** identify and establish a process for collaboration on risk mitigation with other organizations and partners
*** integrate Enterprise Risk Management into the organization
*** focus resources on key risks in order to achieve the organization’s objectives
(Source – PricewaterhouseCoopers – effective ERM)
Under IAA Standard 2120 – Risk Management:
“The internal audit activity must evaluate the effectiveness and contribute to the improvement of risk management processes.”
Practice advisory 2120.C1 states: –“During consulting engagements, internal auditors must address risk consistent with the engagement’s objectives and be alert to the existence of other significant risks.
In manufacturing companies, production is usually the most important aspect of the entire process mostly due to the high cost incurred, the staffing and the complexity of the departments involved –
Production is of vital concern to management because of the important risks associated with the process. I have identified some of the most important risks and how to manage the risks to minimize the impact.
Along with the production process, other areas can be identified as posing risks; distribution, finance, human