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Inside Internal Controls

News and discussion on implementing risk management

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Author Archive - Norman D. Marks, CPA, CRMA

Norman D. Marks is an Author, Evangelist and Mentor for Better Run Business, as well as an OCEG Fellow and Honorary Fellow of the Institute of Risk Management. Mr. Marks has been a practitioner and thought leader in internal audit, risk management, and governance for a long time. He has led large and small internal audit departments, been a Chief Risk Officer and Chief Compliance Officer, and managed IT Security and governance functions. Read more

The updated ISO risk management standard merits our attention

Neither the ISO nor the COSO updates will, in my opinion, move the understanding and practice of ‘risk management’ to where they need to be. The updates are small steps when leaps were required.

 

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One objective but multiple risks

Some organizations and consultants are wedded to the idea that the level of risk can be quantified and calculated as the magnitude of a potential effect (or consequence) multiplied by its likelihood.

 

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Risk visualization

Risk visualization can help executives make decisions not only to manage risks but to optimize outcomes and achieve objectives. I have to agree with the author of Are we witnessing the demise of the risk register (and the rise of risk visualisation)? He says, “I loathe risk registers”. So do, but for different reasons. He […]

 

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It’s not about risk management – it’s about the achievement of objectives

I have said many times that it’s not about managing risks: it’s about managing the achievement of objectives. It’s about being successful. Success is measured through the achievement of specified objectives. We improve the likelihood and extent of success if we understand what might happen, both good and bad, as we strive to achieve our […]

 

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How should you assess the effectiveness of risk management?

If an organization seeks to perform at world-class levels, it needs to have highly effective processes and practices for managing what might happen – risk.

 

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Collaboration between the business risk and IT security teams

Take each of your business objectives and plans. Now, figure out what might result from a technology-related failure (noting that ‘technology’ extends beyond the IT function). Then, what are you going to do about it?

 

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The worst audit report I have seen

I have seen a few candidates for this title, but one stands out. This is how I described it in my best-selling book, World-Class Internal Audit: Tales from my Journey:

 

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An example of game theory in risk management

One of the risks identified by many organizations as significant and included in the risk disclosures required in corporate filings, such as the annual and quarterly filings with the U.S. Securities and Exchange Commission, is the loss of key personnel.

 

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Measuring ethical culture

This presents a discussion on how to measure ethical culture. I just read an interesting article by Scott Moritz of Protiviti. Measuring Ethical Culture – Tapping into Open Secrets is an easy read and covers the main points. He suggests that employees are more likely than in previous years to answer a survey honestly, assuming […]

 

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Identifying, assessing, and evaluating risk is the easy part

COSO ERM 2017 talks about strategy selection, which is a very important decision, and how you need to assess each option. The selection process includes understanding what might happen under each option (risks and opportunities in their language), weighing all the pros and cons, and then choosing the one that makes the most business sense.

 

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The state of information or cyber security today

Senior management must understand the state of information or cyber security today and how it affects enterprise objectives and the delivery of value to customers and other stakeholders. A number of recent publications talk to this topic.

 

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Key principles of successful risk management

Somehow, we need to move the practice away from a periodic review of a list of risks (which Jim refers to as enterprise list management) and to increasing the likelihood and extent of success.

 

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Is asking about risk culture the right question?

If you don’t have a consistent attitude towards taking risk among the few members of the executive team, how can you expect to have a consistent attitude among the population of employees and decision-makers?

 

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Risk and game theory

game theory

The Cuban Missile Crisis is frequently cited as an example of the use of Game Theory. I am talking about the situation confronting the Kennedy government when they found that the USSR had installed missiles in Cuba that were capable of hitting American cities with nuclear weapons. Here is a link to a summary of […]

 

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Do we understand what a risk event is?

COSO ERM talks about the possible effect of an event on objectives, and in common parlance we are talking about something happening that has an effect on the organization. (COSO thinks of risk as the possibility of that event occurring; ISO talks about risk as the effect of what might happen on objectives.)

 

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