A brief analysis of the differences and connections between risk management and internal audit: An important sign of successful external investment risk management is effective control of external investment risks and strong risk response capabilities. Internal audit can help management discover, Assess risk factors in external investment, promote the establishment of complete and appropriate risk management processes and procedures, and promote the full operation of these processes and procedures to maintain effective control.
1. Risk Management
Risk management refers to the management process of how to minimize the possible adverse effects of risks in a project or enterprise where there is definitely a risk environment.
Risk management: This includes the measurement, assessment and response strategies of risks
Ideal risk management is a series of prioritization processes, so that the things that can cause the greatest losses and are most likely to happen are dealt with first, while things with relatively lower risks are deferred.
In reality, the optimization process is often difficult to decide because risks and likelihood of occurrence are usually not consistent, so the proportion of the two must be weighed in order to make the most appropriate decision.
Risk management also faces the problem of effective resource utilization. This involves the factor of opportunity cost. Allocating resources to risk management may reduce the resources that can be used for return-related activities; and ideal risk management hopes to spend the least resources to resolve the largest crisis as much as possible.
“Risk management” was once a required course for executives in the Western business community who went to China to invest in the 1990s. At that time, many MBA courses included additional "risk management" links.
Risk management (risk management)
The process of weighing the benefits and costs of reducing risks and deciding what measures to take.
The process of determining the cost-benefit trade-offs of reduction and deciding on a plan of action (including deciding to take no action) is called risk management.
First, risk management must identify risks. Risk identification is the determination of what risks may have an impact on the business, and most importantly, the quantification of the degree of uncertainty and the degree of loss that each risk may cause.
Secondly, risk management should focus on risk control, and companies usually take active measures to control risks. The purpose of control is achieved by reducing the probability of loss and reducing the degree of loss. The most effective way to control risks is to formulate practical emergency plans and prepare multiple alternative plans to be fully prepared to the maximum extent possible for the risks faced by the enterprise. When a risk occurs, losses can be kept to a minimum by implementing the pre-plan.
Thirdly, risk management requires learning to avoid risks. While the established goals remain unchanged, change the implementation path of the plan to fundamentally eliminate specific risk factors. For example, setting up modern incentive mechanisms, training programs, talent backup, etc. can reduce the risk of losing knowledge employees.
Risk management is mainly divided into two categories:
Operation and management risk management mainly studies the management of risks faced by all enterprises such as political, economic and social changes.
Insurance-based risk management mainly takes insurable risks as the object of risk management, puts insurance management at the core, and uses safety management as a supplementary means.
2. Internal Audit
Sawyer, the father of internal audit, defined internal audit as: the independent evaluation of various operations and controls in an organization to determine whether recognized policies are followed. and procedures, whether they comply with regulations and standards, whether resources are used effectively and economically, and whether organizational goals are being achieved.
Main content:
Internal audit shows specific audit content for different industries and fields:
For the medical and health industry
Medical charge monitoring
Preset medical charge price assessment indicator standards in the system to track and supervise the medical charge system in real time.
If the processing of the medical billing system deviates from the corresponding standard indicators, these data will send a signal or message to the supervisor in the monitoring program.
Medical Equipment Monitoring
The system can supervise the use of large medical equipment. Combined with medical charge monitoring, it can control the charges for large medical equipment and prevent missed charges for medical equipment. , the occurrence of private charges; at the same time, it is convenient for hospital leaders to understand the use and income of large medical equipment.
Drug Price Monitoring
Real-time monitoring of drug prices in the system is achieved through real-time tracking and supervision of daily accounting data in the inventory system through relevant monitoring programs. If the processing of the inventory accounting system deviates from the monitoring limits or parameters, this data will send a signal or message to the supervisor in the monitoring program.
Monitoring budget execution of administrative institutions
The system has the function of automatically reading the budget system, and based on the corresponding relationship between the set budget items and financial data , realize comparative analysis and penetrating query of financial data and budget data, financial indicators and budget data, and budget indicators, find out the reasons for the differences, and define early warnings for budget implementation to achieve multiple levels of early warning prompts.
Special Fund Monitoring
Check the sources of special funds and the implementation of expenditures by setting the total and sub-item amounts of special fund sources as well as the total expenditure and sub-item amounts; check revenue and expenditure Check whether there are over-expenditures in the implementation, and check whether there are cross-account and irregular accounting of special funds.
For the manufacturing industry
Inventory age monitoring
Reflect the inventory structure of the enterprise in a timely manner by monitoring the inventory business of raw materials, semi-finished products, inventory goods, etc. , fund occupancy, backlog quantity, and backlog time, so that enterprise inventory management personnel can timely grasp and adjust the inventory turnover frequency, and revitalize backlog funds, which not only ensures the timely supply of inventory materials to production needs, but also prevents excessive backlog and improves the efficiency of fund use.
Monitoring of sales business
Through the monitoring of sales business, sales data can be updated in real time in the system, so that sales data such as sales revenue, unit cost, and unit profit can be analyzed in a timely manner. Conduct analysis to enable corporate managers to grasp market conditions in a timely manner, especially the sales prices of the same product in different markets, so as to make further market strategic adjustments.
Financial Monitoring
The real-time monitoring of the financial system in the system is achieved through real-time tracking and supervision of daily accounting data in the financial accounting system through relevant monitoring programs. If the financial accounting system If the processing deviates from the audit limits or parameters, the monitoring program will automatically send an early warning signal or message to the auditors.
Financial normative control
Cash payment monitoring: Monitoring can be carried out according to the defined cash payment check formula.
Abnormal voucher monitoring: Auditors can define the account correspondence in abnormal vouchers according to the provisions of the accounting system and internal financial system. When the voucher occurs, the system can promptly prompt and record these abnormal correspondence vouchers, and prompt Internal control system deficiencies involved in these abnormal credentials.
Financial analysis monitoring
It allows you to set and combine the methods provided by financial analysis tools, define analysis standards, and conclusions that violate standards, form a specific analysis plan, and each analysis , its analysis results can be set in advance, and problems that occur in the management process can be discovered through the analysis results.
Economic indicator monitoring
You can set the control of indicator value range, indicator value trend, indicator year-on-year number, and indicator budget number through the economic indicators defined by the system.
Monitoring of large-amount receipts and payments
By setting the monitoring limits for large-amount receipts and payments in cash and bank deposit accounts, when the amount or quantity of receipts and payments is too large, the monitoring program will automatically notify the auditors Send an early warning signal.
Audit operation monitoring
Help audit staff to carry out audit supervision operations in accordance with legal regulations and enterprise authorization, real-time monitoring, timely warning and investigation of violations of laws and regulations.
Monitoring of major doubtful points
By setting up the method of classification and monitoring of doubtful points, the audit doubtful points discovered during the audit work will be monitored and prompted according to the principle of importance, helping the audit supervisor to clarify the detailed audit investigation direction.
Monitoring of major violation amounts
By setting classification standards for violation amounts, we monitor the amount of violations found during the audit process and help the audit supervisor to provide monitoring prompts based on the principle of importance. Prompt the audit supervisor the significance of the audit project in terms of the amount of violations. For example: when the amount of violation exceeds 100,000 yuan, the system will send monitoring and early warning information to the auditors.
Monitoring of non-compliance issues
By setting importance standards for non-compliance issues, monitor the attributes and importance of non-compliance issues during the audit process, and help the audit supervisor determine the severity of the problem , remind the audit supervisor of the seriousness of the audit project in terms of non-compliance issues. For example: when the violation problem is a serious violation of laws and regulations such as corruption or petty treasury, the system will send monitoring and early warning information to the auditors.
Audit job progress monitoring
By comparing the actual progress of the audit job with the planned progress, setting the planned progress, completing the difference monitoring indicators, and monitoring the progress of the audit job, when When major discrepancies occur, timely monitoring prompts are provided to help the audit supervisor understand possible problems and their severity in the audit work. For example: when the actual progress is significantly behind the planned progress by 30%, the system will issue a monitoring warning message to the auditors.