2010 Wrc Presentation Reid H. Griffin

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Breakout Session presentation on the perils of business risk

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2010 Wrc Presentation Reid H. Griffin

  1. 1. Enterprise Risk: The ICU Medical Journey SPEAKER Reid H. Griffin CPA, CIA, CCSA, CISA
  2. 2. Background-Reid Griffin <ul><li>30 plus years in finance/accounting/auditing with private/public companies ranging from start-ups to Fortune 500, including 3.5 years as Director of Risk Assurance Services for ICU Medical, Inc. </li></ul><ul><li>Previous speaking engagements at the IIA National Conferences (GAM and GRC) on the topics of Enterprise Risk and Audit approaches for the new millennium. </li></ul><ul><li>I am from the great state of New Jersey! </li></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  3. 3. IIA Definition-Internal Audit <ul><li>Internal Auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management , control, and governance processes. </li></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  4. 4. What is Risk? Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  5. 5. What is Risk to a Company? <ul><li>...the threat that an event, action or inaction will adversely affect an organization’s ability to achieve its business objectives and execute its strategies successfully. </li></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  6. 6. What is Risk Appetite? <ul><li>Risk Appetite : Is the amount of risk on a broad level an entity is willing to accept in pursuit of value. It is a strategic guidepost in strategy setting. It is a qualitative measure reflecting the entity’s risk management philosophy, and in turn, the entity’s culture and operating style. </li></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  7. 7. What is Risk Tolerance? <ul><li>Risk Tolerance : Is the acceptable level of variation relative to achievement of a specific objective , and often is best measured in the same units as those used to measure the related objective. Risk tolerance is tactical . In effect, risk tolerance address the question, “How much variability are we willing to accept as we pursue a given business objective. </li></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  8. 8. Risk-Wasted Time and Resources Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  9. 9. Is Operational Risk more than Financial Reporting Risk? <ul><li>Product Recall </li></ul><ul><li>Employee Kidnapping </li></ul><ul><li>Oil Spill </li></ul><ul><li>Sexual Harassment </li></ul><ul><li>Supplier Disruptions </li></ul><ul><li>Recession </li></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  10. 10. The Controls House Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address] Internal Operation Controls permeate throughout the organization, not just in Financial Reporting.
  11. 11. How do you sell Enterprise Risk Management? <ul><li>Who are your stakeholders? </li></ul><ul><ul><li>The Audit Committee </li></ul></ul><ul><ul><li>Senior Management </li></ul></ul><ul><ul><li>Board of Directors </li></ul></ul><ul><li>What is your message? </li></ul><ul><ul><li>Education </li></ul></ul><ul><ul><li>Knowledge Transfer </li></ul></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  12. 12. How do you implement Enterprise Risk Management <ul><li>Sell the need for an Enterprise Risk Assessment </li></ul><ul><ul><li>Key to developing a Risk-Based Audit Plan </li></ul></ul><ul><ul><li>Completing the Risk Universe </li></ul></ul><ul><ul><li>Identify for the stakeholders the areas of key risks and the extent of management controls to mitigate those risks. </li></ul></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  13. 13. Executing a Enterprise Risk Assessment <ul><li>Effective Project Management-Critical </li></ul><ul><li>Resource Planning: Inside or outside sourcing </li></ul><ul><li>Define deliverables, tools and templates </li></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  14. 14. Example-Enterprise View Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  15. 15. Example Portfolio of Risks Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]
  16. 16. Heat Risk Map Example Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address] 1 0.0 5.0 10.0 15.0 20.0 25.0 1.0 2.0 3.0 4.0 5.0 Management/Control Level Risk Exposure (Impact x Likelihood) High High Low Low Monitor Risks Monitor KRI Self Assess Audit
  17. 17. Pitfalls to watch out for when executing an Enterprise Risk Assessment <ul><li>Project Mismanagement </li></ul><ul><li>Management Misunderstanding </li></ul><ul><li>Value Proposition Confusion </li></ul><ul><li>Line Management Confusion </li></ul><ul><li>Risk Map Reporting Misunderstanding </li></ul>
  18. 18. Questions?
  19. 19. Reid H. Griffin-Dogged Consulting <ul><li>Reid H. Griffin CPA, CIA, CCSA, CISA </li></ul><ul><li>www.doggedconsulting.com </li></ul><ul><li>949-293-6325 Cell </li></ul><ul><li>[email_address] </li></ul>Reid Griffin CPA, CIA, CCSA, CISA Doggedconsulting.com [email_address]

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