Page 79 - RISK Management IC86 Ebook

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n COSO's resulting document, Enterprise Risk Management
Framework, provides a risk management architecture in terms
of eight components to be considered under each of four
categories of objectives.

The four categories of objectives

1. Strategic - High-level goals designed to support the

entity's mission or vision.

2. Operations - Efficiency of operations, including

achievement of performance goals and

safeguarding against loss.

3. Reporting - Reliable financial and operational data and

reports.

4. Compliance - Compliance with laws and regulation.

The Eight components

ERM is a multi directional iterative process in which the eight
component influence each other. The dynamic application of
ERM recognises the interrelationship between components
and considers the impact of each component on others.
1. Internal environment
n It is the context within which the enterprise functions. The
organization's reporting structure, assignment of authority,
development of personnel, risk appetite, management style

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