Dealing With Business Risks

When talking about running a business, one of the most important points that must be addressed is in relation to business risks. When mistakes and accidents happen, the company can face heavy losses in different avenues such as productivity, finances and, in some cases, its image in the market. 

However, the good news is that most failures can be avoided through knowledge and planning. Thus, measuring, controlling and forecasting are important steps so that work processes are efficient, and the organization is able to keep its systems optimized. 

Read on and find out about some of the main risks your business is subject to! 

Tax risks 

Tax risks relate to legal obligations related to declarations and taxes. An example is to submit the declaration with wrong or late data and receive a fine for that. Also, not issuing invoices in accordance with the law, which could cause the company to be accused of tax evasion. 

To get rid of this impasse, it is essential to have a detailed tax planning, in order to define the business procedures to meet these responsibilities and structure the dangerous points. Having help from a trusted accountant also helps make the organization less vulnerable to these failures. 

Operational risks 

Operational business risks are defined as those resulting from failures in internal, external processes, systems and people, which together constitute an organization. They are specific to each environment. So, a gas station, for example, has the risk of exploding if the fuel is not stored properly. A bank is in danger of being robbed if there is no effective security system. 

There are a few ways to avoid such threats. One is to carry out a mapping of the processes, in order to identify those weakest points and, with that, apply mitigation techniques. At this point, it is essential that the company adopts compliance actions as a standard of organizational behavior. 

Some of the details to be evaluated are infrastructure, people, IT, routine activities. In infrastructure, it is advisable to analyze possibilities of landslides and floods, for example. In people, conflicts, corruption. In IT, the likelihood of losing important data. In the activities, it is recommended to know the step by step of the main departments, such as HR and the purchasing area. 

Financial risks 

As the business grows, the financial management becomes more complex. While at the beginning, the manager can manage to balance the finances on his own, possibly he will need help when the enterprise is already more developed. 

The goal is always to make the gains outweigh the expenses. For this, a lot of monitoring is essential. In cash flow, for example, it is necessary to make an adequate projection of the inflows and outflows, so that operations are always in the blue. This is because it is common for customers to make purchases in installments and, before these funds enter, the company needs to make payments to suppliers or employees' salaries, for example. 

Thus, in order to avoid such financial business risks, the manager needs to comply with certain actions, such as time adjustments and payment with suppliers, in addition to seeking savings in common expenses, such as water and electricity bills. 

Cyber ​​risks 

Having a safe digital behavior and investing in the protection of the company's systems, with antivirus and firewalls, is essential to prevent important information from being stolen by malicious people .Another recurring situation is in companies that receive payments and see themselves as targets for information theft from customers. In these situations, it is recommended to invest in cryptographic stamps and certifications for the websites, in addition to a payment system that offers protection in transactions. 

Risks in the workplace 

It is the obligation of every company to offer a safe work environment that will free workers from accidents and occupational diseases Thus, they need to take care of physical (such as noise and extreme temperatures), chemical (such as toxic substances) and biological (such as viruses, bacteria and protozoa) risks. In addition, ergonomic risks (such as repetitive activities and inadequate posture) and accidents (such as explosions, fires and falls) are also the focus of attention when it comes to occupational health. 

It stands to reason that business risks cannot be completely eliminated. However, it is essential that each organization does its own planning and study of the environments, so that the main threats are avoided. Effective management contributes to financial health and business success. 

Read out our blog about Audit risk model also.

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