Company Risk Avoidance Plan

Risk management is an essential aspect of modern business aimed at ensuring the profitability of diverse ventures for the business owners. In this report the discussion presented will focus risk avoidance strategies that can be used in the management of companies, avoidance of risks associated with securities regulations, avoidance of risks associated with accountant liability and avoidance of agency associated risk.Advertising We will write a custom report sample on Company Risk Avoidance Plan specifically for you for only $16.05 $11/page Learn More According to Oren, Risk Avoidance involves setting of margins and thresholds that are used to avoid unacceptable risk where acceptability limits are typically established by experts (2001). In the management of companies risk avoidance may be as a result of poor decision making. For managers interested in mitigating risks one approach could be the use of decision analysis tools (Oren, 2001). These tools will provide several scenarios taking into consideration objective and subjective information as well as the decision maker’s preference. The tool can then be used to identify the best alternative. It has been reported that the approach has been successfully implemented in various decision making contexts such as product development decisions, assessment of investment options, etc. Another approach that can be used by management with a view to Risk Avoidance is to enlist the services of regulatory bodies. BGP technology is a biotechnology company and as such the products produced pose some degree of risk to the public. Regulatory bodies such as the Food and Drug Administration (FDA) perform a set of expert designed tests that are highly reputable (Oren, 2001). The FDA approval seal on the company products is one essential component that management can use to avoid legal risks associated with products. Upon approval of a product in case of any complaints about the drug the company can share the blame with the FDA. The environmental protection Agency (EPA) can also be called upon by management to carry out inspection on facilities and provide certification on emission levels and toxic waste management (Oren, 2001). With regards to regulation of securities the management of the company can avoid risk by implementing strategies such as hedging. Hedging is a strategy that avoids risk by spreading the risk or financial consequence associated with a particular risk (Oren, 2001). In this approach the management will make an investment portfolio that selects companies whose trading outcomes are correlated so as to reduce the overall variability. An area of risk avoidance that has been the cause of much debate in recent years is the degree of liability a company should commit to in the case of a company agent. In the scandals that saw companies such as Enron fall, investors lost huge sums owing to the poor decisions by the auditors and the company directors. Followin g such losses constructs such as proportionate liability have been established to avoid risks associated with company agents (Faure, 2009).Advertising Looking for report on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More As a result of such actions it has been observed that many firms have stopped provision of audit services within high risk business categories (Linville, 2002). This scenario has led to a situation where on very knowledgeable and well capitalized firms are ready to risk undertaking audit activities. These new regulations have further raised the costs associated with auditing. One advantage of such measures is that they have led to a decline in litigation against firms with deeper pockets that were typically the target of litigation in earlier times (Faure, 2009). This is possibly through the increased motivation by agents to fully comply with industry regulations thus leaving very little room for error. N evertheless despite the disadvantage of increased cost the proportionate liability regulation has helped in regulating industry players with regards to compliance. For successful implementation of the proportionate liability entity the various agencies associated with a business entity must be properly classified. An agent is a vehicle that can be used to perform a specific function on behalf of the business entity. Categories that typically are categorized as agents include legal services, accounting services, trading companies, etc (Peterson, 2007). In light of current legislation in the SEC, agents and principals are required to comply with specific regulations in a view to protection of client interests. It has been established that for the agency to perform their duties well adequate incentives must be offered to ensure that the agent does not under perform (Peterson, 2007). This suggests that to avoid risk selection of agents should be done with care and results from the regul atory bodies within those industries used to confirm performance criteria. In addition to hedging with regards to investment on the stock market another possible solution that could be used in the avoidance of risk by BGP technology is making improvements in the Business Process Management (BPM) cycle. BPM is an essential aspect that can be used to improve the competitive advantage by ensuring the smooth flow of all business processes. A biotechnology company such as BGP is likely to be involved in manufacturing. Through appropriate analysis of the supply chain adjustments can be made to ensure product prices are maintained and profitability is sustained (Muehlen Ho, 2006). An example of improvement of the business processes in this case could involve the use of hedging in the supply chain. It is likely that the cost of raw materials fluctuates and affects the cost of the finished products.Advertising We will write a custom report sample on Company Risk Avoidance Plan specific ally for you for only $16.05 $11/page Learn More Just as in agriculture a hedge fund can be established using a suitable price for raw material (Oren, 2001). This fund thus acts as a buffer protecting the company from changes in prices. This can ensure that the company can withstand the risk associated with increases in cost of raw material. Though the material provided in this report is not conclusive, it attempts to highlight various risk avoidance schemes. These schemes are among several risk avoidance schemes that can be used in addressing issues related to management, securities, accountant liability and agency associated suits. References Faure, M. (2009). Tort Law and Economics. Massachusetts: Edward Elgar Publishing Limited. Linville, M (2002). CPAs’ Awareness of Litigation Risk. Academy of Accounting and Financial Studies Journal, 6(3), 11-21. Muehlen, M. Z. Ho, D. T. (2006). Risk Management in the BPM Lifecycle. Business Process Management Workshops, 454-466. Oren, S. (2001). Market based Risk Mitigation: Risk Management vs. Risk Avoidance. White House OSTP/NSF Workshop on Critical Infrastructure Dependencies, 1-10. Peterson, C. L. (2007). Preemption, Agency Cost Theory, and Predatory Lending by Banking Agents: Are Federal Regulators Biting off More than they can chew? American University Law Review, 56(3), 515-549.Advertising Looking for report on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More This report on Company Risk Avoidance Plan was written and submitted by user Tony Valenzuela to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

Free Essays on Computer Crime And Its Effects On The World

Computer Crime has become a very large issue in our society today; this paper will look at this issue from a sociological perspective. It will analyze the various crimes that make up computer crime and see what changes it has brought about in the world in which we live in. Computer crime first is a very new problem in our society today and it is crimes that are committed from a computer. These include embezzling, breaking into other computers, cyber porn and various other crimes that have a drastic affect on the society and the institutions that each of us hold to keep our global society running. To first understand computer crime one must understand first what crime is. According to Diana Kendall, â€Å"crime is a behavior that violates criminal law and is punishable with fines, jail or other sanctions†(Kendall 1999; 161). Yet since computer technology is so new it has really no laws to govern it. A law is formal norms that are enforced, norms being established rules of behavior. Many of the crimes committed on computers often times go unpunished. As stated by David Pitchford in the London journal Focus when writing on pornography on the Internet, â€Å" the only way illegal pornographers can be caught is through chance leads, tip-offs and telephone tracing† (Focus 1995; p10-12). Many of the crimes that are also committed on computers via the Internet are very new also. New subcultures have formed around the Internet for the possibilities it brings. Computer crime despite the many problems it has brought has also brought some needed social controls to the Inter net and as stated before some laws have been formed to protect many of the institutions that because of computer crime have become targets for criminals. Body Now that I have briefly explained computer crime, I will go into further depth into explaining computer crime from the different sociological perspective theories. To start with is the integrationist perspective looks a... Free Essays on Computer Crime And It's Effects On The World Free Essays on Computer Crime And It's Effects On The World Computer Crime has become a very large issue in our society today; this paper will look at this issue from a sociological perspective. It will analyze the various crimes that make up computer crime and see what changes it has brought about in the world in which we live in. Computer crime first is a very new problem in our society today and it is crimes that are committed from a computer. These include embezzling, breaking into other computers, cyber porn and various other crimes that have a drastic affect on the society and the institutions that each of us hold to keep our global society running. To first understand computer crime one must understand first what crime is. According to Diana Kendall, â€Å"crime is a behavior that violates criminal law and is punishable with fines, jail or other sanctions†(Kendall 1999; 161). Yet since computer technology is so new it has really no laws to govern it. A law is formal norms that are enforced, norms being established rules of behavior. Many of the crimes committed on computers often times go unpunished. As stated by David Pitchford in the London journal Focus when writing on pornography on the Internet, â€Å" the only way illegal pornographers can be caught is through chance leads, tip-offs and telephone tracing† (Focus 1995; p10-12). Many of the crimes that are also committed on computers via the Internet are very new also. New subcultures have formed around the Internet for the possibilities it brings. Computer crime despite the many problems it has brought has also brought some needed social controls to the Inter net and as stated before some laws have been formed to protect many of the institutions that because of computer crime have become targets for criminals. Body Now that I have briefly explained computer crime, I will go into further depth into explaining computer crime from the different sociological perspective theories. To start with is the integrationist perspective looks a...

Water incident Essay Example | Topics and Well Written Essays - 750 words

Water incident - Essay Example The company is no stranger to such incidents. It has been part of all major oil disasters in thee US for the last five years (Lustgartern). Since the explosion in the deep water rig causing death to 11 persons on April 20, 2010, the oil spill has continued to claim the lives of wild life; it has seriously threatened the travel and tourism plans of the region as well as affected the culture of the gulf coast. The oil rig that cme into causing an accident in the Gulf coast, The deep water horizon was a nine year old rig having a semi submersible mobile drilling unit.and a dynamic positioned drilling rig. The company has taken this rig on lease from Transocean. At the time of explosion, the rig was drilling an exploratory well at a depth of nearly 5000 feet under water The incident occurred on April 20 2010 at approximately 9.45pm. gas from the well under high pressure shot up and out of the well triggering into a huge explosion. Efforts made my ships to bring down the fire proved unsuccesful. The fire lasted for nearly 36 hours after which the platform sank to the deep waters. The spread of the oil was very rapid due to the strong southernly winds that was caused by the impending cold front. Five days from the blast, the spill spread to nearly 580 square miles. And was near to the ecologically sensitive Chandeleur Islands. By April 30, the spread widened to approximately 3850 square miles. The spill reached the Delta national wild life refuge and Bretton national wild life refuge. . By May 19 the spill reached the Loop current which flows around the Gulf of Mexico. It was found that about 35% of the oil leaked would evaporate, 50% will remain in the water and the rest would be dissolved in the ocean. It was also estimated that most of the oil would be floating within one foot of the surface of the water causing serious environmental damage to all living organisms. The