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Risk Identification and Measurement

Material Summary of Risk Identification and Measurement and Analysis of PT Kimia Farma Tbk Risk Identification

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yoshiharu.harano1726
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17 views14 pages

Risk Identification and Measurement

Material Summary of Risk Identification and Measurement and Analysis of PT Kimia Farma Tbk Risk Identification

Uploaded by

yoshiharu.harano1726
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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RISK

IDENTIFICATION
AND MEASUREMENT

By Yoshiharu Harano - 042111233259


INTRODUCTION
Definition of Risk

Risk refers to exposures that may lower profits or


lead to failure due to various factors. Business
risk encompasses several aspects, including
changes in consumer tastes, the broader
economy, government policies, and internal
decisions made by management or executives.
Risk can originate externally, beyond the
company's control, or internally due to
managerial choices.
RISK IDENTIFICATION
COMPREHENSION Identify risks and study the
characteristics of these risks
Measuring the risk, seeing how much
impact the risk has on the company's
IDENTIFICATION performance, and determining the risk
priority
EVALUATION
REVISIT PROSES MAPPING RISIKO (RISK
PRIORITAZION MANAGEMENT CYCLE)

MANAGE
SOURCE OF RISK FIRE

RISK SEQUENCE
ANALYSIS RISK FACTOR* PETROLEUM PLACED
NEAR THE STOVE

Risk has a sequence from the


source of the risk to the WAREHOUSE THAT
emergence of losses due to EXPOSURE TO RISK COULD CATCH FIRE
the risk.

PERIL* CASE OF FIRE


*Risk Factor --> conditions that increase
the likelihood of loss
*Peril --> events that result in loss
LOSS
IDENTIFY SOURCES OF RISK
Another technique is to expand observation of risk sources. After the risk sources have been
identified, we try to see what risks could arise from these risk sources.

buildings that age and become brittle, rivers that can cause floods, earthquakes, storms, typhoons,
Physical Environment
vandalism

Social Environment social unrest, demonstrations, conflicts with local communities, employee strikes, theft, robbery

changes in legislation, changes in regulations, conflicts between countries that encourage boycotts of
Political Environment
company products

Legal Environment lawsuit for failure to comply with applicable rules and regulations

Operational Environment work accidents, machine breakdowns, computer system failures, virus attacks on computers

Economical Environment economic downturn (recession), uncontrolled inflation


IDENTIFY SOURCES OF RISK Alternative categories for the sources of riskd

complaints from consumers that result in disappointment and no longer wanting to buy the company's
Consumers
products, consumers feel aggrieved and then sue the company

Suppliers supplies from suppliers do not arrive as expected (late or different specifications)

competitors launch new, better products, competitors lower prices which can result in price competition
Competitors
which reduces the company's profit level

the company fails to comply with applicable regulations or laws, changes in applicable laws which
Regulators
result in the company losing money (e.g. minimum wage increases, severance rules, etc.)
OTHER SUPPORTING
TECHNIQUES
Financial Reporting Methods
Analyze the Flow Chart of Company
Activities and Operations
Contract Analysis
Loss Statistics Records and
Company Loss Reports
Surveys or Interveiws with Manager
RISK MEASUREMENT
Risk measurement is usually
Type Definition Measurement technique carried out through risk
quantification
Measuring and quantifying
Market Risk
market prices move in an
Value at Risk (VAR), stress-testing
risk will greatly depend on the
unfavorable (adverse) direction characteristics of the risk.

the counterparty cannot pay its


Credit Risk obligations (defaults) to the Credit rating, creditmetrics
company

Changes in interest rates change resulting in method of measuring time period,


Interest losses to the company's portfolio duration

losses incurred through company


Loss frequency and significance
Operational Risk operations (failed systems, terrorist
matrix, operational VAR
attacks)
CONTD.
Risk measurement is usually
Type Definition Measurement technique carried out through risk
quantification
Measuring and quantifying
humans experience premature death
Probability of death with a
risk will greatly depend on the
Risk of Death (faster than the natural age of characteristics of the risk.
mortality table
death)

Probability of getting a disease


Health Risk humans suffer from certain diseases
using the morbidity table

Technological changes have


Technological Risk negative consequences for Scenario Analysis
companies
LOSS FREQUENCY

HIGH
AND SIGNIFICANCE

SIGNIFICANCE
MATRIX Risk of
Human Error
1. Develop risk standards

LOW
2. Apply these standards to
identified risks

LOW HIGH

FREQUENCY
COMPANY ANALYSIS
PT Kimia Farma (Persero) Tbk
Risk Identification and its
Measurement (Based on Annual
Report, 2022)
THANK
YOU

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