The demands of additional reporting requirements relating to risk have increased and now include statements in annual reports about risk management and internal controls required by the Combined Code, discussions on risk as a result of the operating and financial review requirements and, for companies affected by US listings, statements about effectiveness of internal controls mandated by S404 of the Sarbanes Oxley Act. Because of this, listed and many other companies are now required to make some formal statement of their risk management procedures.

However, confusion remains on a basic level regarding risk and its role in the organisation. As finance professionals we are involved in risk on many different levels and, being in a central function, often (unknowingly) end up being the central risk manager.

In this special report Judith Shackleton, technical manager of the Faculty of Finance and Management of the ICAEW, offers an update on the basics of risk, before taking a look at some of the current issues in risk management today and concluding with a summary of some of the best resources which the Faculty has found to help you manage risk in your organisation.

Published by the Finance and Management faculty (SR10 - December 2005)