Fraud Risk Management Processes
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Questions and Answers

What can result from a lack of understanding or communication between departments?

Inaccurate reporting, which can affect the company’s credibility.

Why is it challenging to prove the financial return of sustainable practices?

It is difficult to quantify the direct financial return on investment, and empirical evidence linking sustainability to financial gains is mixed.

How does Marico mitigate interest rate fluctuations?

Marico diversifies its funding sources and uses interest rate swaps.

What primary operational risks does Marico face?

<p>System failures, supply chain disruptions, and poor employee oversight.</p> Signup and view all the answers

How does Marico address regulatory compliance?

<p>By following strict legal frameworks, conducting audits, and performing periodic reviews.</p> Signup and view all the answers

What is a consequence of improper waste management?

<p>It can lead to regulatory penalties, brand damage, and environmental harm.</p> Signup and view all the answers

What mechanism does Marico have in place to handle ethics violations?

<p>Marico has a whistleblower mechanism and strict enforcement of ethical policies.</p> Signup and view all the answers

What key learning strategy does Marico employ from past projects?

<p>It integrates lessons learned into decision-making processes to improve future strategies.</p> Signup and view all the answers

What tools does Infosys utilize to monitor water scarcity?

<p>Infosys uses tools that track rainfall patterns, water tables, storage capacity, and freshwater sources.</p> Signup and view all the answers

In what way do underground reservoirs and rainwater harvesting benefit Infosys' water management?

<p>They serve as backup water supplies during shortages.</p> Signup and view all the answers

What is the role of sustainability teams in managing water availability at Infosys?

<p>Sustainability teams gather and analyze data to ensure sufficient water resources are available.</p> Signup and view all the answers

How does effective water risk management enhance Infosys' operational flexibility?

<p>It allows Infosys to operate in locations where competitors might struggle due to water scarcity.</p> Signup and view all the answers

What competitive advantages does Infosys enjoy from its water risk strategy?

<p>Infosys benefits from continuous operations and the ability to expand in water-scarce areas.</p> Signup and view all the answers

How does stored water during shortages contribute to customer confidence?

<p>It prevents service disruptions, maintaining client trust and consistent revenue.</p> Signup and view all the answers

What structural elements enable Infosys to address water risks globally?

<p>Infosys integrates sustainability and risk management teams at all organizational levels.</p> Signup and view all the answers

What key lesson can other companies learn from Infosys' approach to water risk mitigation?

<p>Proactive planning, collaboration, and sustainable practices can build resilience against water risks.</p> Signup and view all the answers

What defines fraud and what are its implications for individuals or organizations?

<p>Fraud is defined as cheating someone to gain something dishonestly, leading to wrongful actions that benefit one person while harming another.</p> Signup and view all the answers

What are the steps involved in the Fraud Risk Management process?

<p>The steps include identifying risks, assessing risks, responding to risks, monitoring and reviewing, and reporting risks.</p> Signup and view all the answers

Why is Fraud Risk Management important for a business?

<p>It is important because it helps reduce potential fraud, protects the company's reputation, and prevents loss of trust from customers and stakeholders.</p> Signup and view all the answers

What role does a Company Secretary play in risk management?

<p>A Company Secretary ensures compliance, protects organizational integrity, and advises on governance, risk management, and compliance.</p> Signup and view all the answers

How does reputation risk affect a business?

<p>Reputation risk can harm a business's relationships and funding, leading to potential long-term damage such as loss of brand value and difficulty in hiring employees.</p> Signup and view all the answers

What steps can businesses take to manage reputation risk effectively?

<p>Businesses can manage reputation risk by including risk management in their strategies, ensuring strong board oversight, and promoting compliance and good governance.</p> Signup and view all the answers

What key questions should a Company Secretary address at the board level regarding risk management?

<p>Key questions include understanding the organization's risk philosophy, risk tolerance, and ensuring effective communication with external parties.</p> Signup and view all the answers

What are the potential consequences of not addressing reputation risk early?

<p>Potential consequences include significant long-term damage such as a drop in share value and broken strategic relationships.</p> Signup and view all the answers

Study Notes

Fraud Risk Management

  • Fraud involves dishonest actions to gain something, harming others
  • Fraud risks can damage a company's reputation, leading to lost customers and revenue
  • Fraud Risk Management (FRM) identifies risks and creates prevention plans

Fraud Risk Management Process

  • Identifying Risks: Analyze individuals and departments likely to commit fraud
  • Assessing Risks: Understand the causes and impact of fraud risks, finding solutions
  • Responding to Risks: Take action to reduce and prevent future fraud
  • Monitoring and Reviewing: Regularly update the process and adapt to changes
  • Reporting Risks: Clearly report risks and suggest solutions to prevent further fraud

Company Secretary's Role in Risk Management

  • Ensures compliance, protects organizational integrity, and upholds ethical standards
  • Advises on governance, risk management, and compliance
  • Promotes ethical and corporate behavior
  • Balances the interests of the board, management, and stakeholders
  • Addresses key risk management questions, such as:
    • Linking risk management to organizational goals
    • Defining the organization's risk tolerance
    • Evaluating if risk responses align with tolerance
    • Assessing communication effectiveness with external parties

Reputation Risk

  • Negative perceptions from customers, investors, regulators, or others, harming relationships and funding
  • Can lead to serious long-term damage if not addressed early
  • Effects include loss of brand value and drop in share value

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Description

This quiz explores the essential elements of Fraud Risk Management (FRM) including identifying, assessing, responding, and monitoring fraud risks. It highlights the crucial role of the Company Secretary in ensuring compliance and promoting ethical standards within an organization. Test your knowledge on the methods and strategies for effective fraud prevention.

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