OBU RAP Topic 16


A critical evaluation of the financial and operational risk management within an organisation

financial risk 2

“Better knowledge of overall concept of Financial and Operational risk and particular knowledge of these to selected organisation  and proper discussion of  all key risk based on vast research on overall operation of the organisation under well qualified mentor is key to success for passing RAP under this topic.”

This topic relates with detail assessment of various financial and operation risk (non-financial) of selected organisation and how management of the organisation manage it to sustain itself in long run.

Definition of Financial Risk: The possibility that shareholders will lose money when they invest in a company that has debt, if the company’s cash flow proves inadequate to meet its financial obligations. When a company uses debt financing, its creditors will be repaid before its shareholders if the company becomes insolvent.  Financial risk also refers to the possibility of a corporation or government defaulting on its bonds, which would cause those bondholders to lose money.

Definition of Business Risk: The possibility that a company will have lower than anticipated profits, or that it will experience a loss rather than a profit. Business risk is influenced by numerous factors, including sales volume, per-unit price, input costs, competition, overall economic climate and government regulations. A company with a higher business risk should choose a capital structure that has a lower debt ratio to ensure that it can meet its financial obligations at all times.

(source: www.investopedia.com)

Whenever an organisation makes any decision regarding its financial and operational objectives, it has an element of risk within it. Decision making is a crucial part of any business. Many companies now allocate large amounts of money and time in developing risk management strategies to help manage risks associated with their business. A key component of the risk management process is risk assessment, which involves the determination of the risks surrounding a business.

Under this topic, first of all student should have basic understanding of overall financial and operational risks and he/she must have particular knowledge of all financial and operational risks of the selected organisation. He must be familiar with all mitigation measure taken by the selected organisation to overcome all identified risk. Student also need to focus on risk assessment strategy (at inception stage overall risk management process) of the organisation  and need to comment on how effective the risk assessment strategy of the organisation based on overall issues faced by the organisation later on in risk management process. This topic is very technical in nature that require huge efforts from student and right approach from inception under this topic is very essential as student must focus on overall requirements of this topic without providing any extra information/detail in the project.

Key features / requirements:

  • Proper explanation of overall concept of financial and operational risk management both in general (i.e. Litterateur Review) and specific to the selected organisation.
  • In depth analysis of different aspects of financial and operational risk management.
  • Assessment of overall strategies adopted by the management of selected organisation regarding financial and operational risk management.
  • Provide some quantitative and qualitative analysis to substantiate above mentioned aspects in proper manner.
  • Maintain proper balance in explanation / analysis of different aspects of financial and operational risk management.

*Feedback from project mentor is essential to get good grades in RAP.

Key Success Factors:

  • Proper application of all selected aims and objectives (that decided in inception of RAP) in appropriate sections of RAP.
  • Proper answering of all research questions (that decided in inception of RAP) in appropriate sections of RAP.
  • Usage of proper research methodology to achieve good result against all selected aims and objectives (that decided in inception of RAP).
  • Maintain proper sequence of all discussion in logical manner by keeping all requirements of the topic.
  • Logically conclude all performed work at the end of Research Report by keeping in consideration of all requirements of the topic.

*Feedback from project mentor is essential to get good grades in RAP.

Major benefits for choosing this topic:

  • Student will practically apply his/her bookish knowledge into real life.
  • Various techniques learned under this topic will substantially help student in his/her professional life.

Major possible limitations faced by student under this topic:

  • Students may not entertain well by the management of selected organisation in provision of required information due to various issues (e.g. confidentiality aspects, non availability of authorized person to disseminate information to student for research work, etc.)
  • Student may not find good stuff from internet  or other sources (due to weak research approach) to bring ideas for improvement in the project.
  • Student may be confused due to variation in actual information (verbal or documented) provided from primary sources with the result that he/she actually derive from his/her research work as per requirement of the topic. 

 *Feedback from project mentor is essential to get good grades in RAP.

Suitable organisation under this topic:

The most suitable organisation under this topic is that for which student have access to management of the company and moreover management of the company is willingly provide all required information to student as required under the topic. Selection of most appropriate organisation is very essential as student must have better understanding of overall operations of the organisation and moreover he/she also have enough knowledge of the sector in which his/her selected organisation actually operates. Based on better knowledge of the organisation and respective sector , student will be able to interlink various aspect of overall operations of the selected organisation with all requirements of the topic that ultimately help him/her in getting good grades.

In short student need to assess following aspects in selection of organisation for RAP.

  • Student’s own interest related to overall business of the organisation;
  • Accessibility of information from primary sources (extremely important in topic 16);
  • Accessibility of information from secondary sources;
  • Knowledge of overall operations of the organisation (extremely important in topic 16);
  • Knowledge of overall associated sector of the organisation;
  • Availability of time from concerned officials of selected organisation (extremely important in topic 16);
  • Basic idea of requirements of selected topic and their applications on proposed organisation in inception of RAP.

*Feedback from project mentor is essential to get good grades in RAP.

Suggested approach for this topic:

Under this topic, student must plan properly from inception so that he/she can complete all tasks effectively in proper manners. First of all, student must  gain excellent understanding of major requirements of this topic and he/she need to critically assess all aspects of requirement by defining detailed strategy.  Student need to assess that what process that he/she actually follow to meet all requirements that only possible through detailed planning in inception of RAP.

Student need to  prepare overall content of RAP under topic 16 that describes logical sequence of all tasks that need to adhere by the student. This content will also help student to keep on right track from inception and at the same time student can also assess time factor against planned vs. actual tasks through considering his allocated time for complete preparation of RAP.

After finalization of overall content of RAP under topic 16, student need to start working logically from gathering of information as per requirement of topic. Student need to assess all gathered information very critically through consultation from mentor. Mentor feedback on key areas of RAP is very essential so student should share his/her thoughts with project mentor regularly to get efficient guidance in time accordingly.

In short, there is no 100% suggested approach for topic 16 as keeping broader level approach (described above) , detailed approach under topic 16 varies due to student’s perception that he conceived from requirements of the topic along with available information of selected organisation. Whatever, the approach you will follow , keep getting guidance from project mentor at every step so that you can meet all requirements of topic and get good grades.

*Feedback from project mentor is essential to get good grades in RAP.

Availability of Information:

Student have to complete his/her RAP based on provision of information directly from management of the organisation (i.e. primary sources of information) along with vast information available through different mediums (internet, newspaper, books, etc.) under secondary sources of information.  Availability of information from primary sources under topic number 16 is very essential as this topic cannot complete at all without getting specific information of the selected organisation. Student need to ensure that he has access of vast information from management of the selected organisation and there is no confidentiality concerns by them as well.

In short, student need to assess very critically before opting this topic for RAP as all requirements of this topic only meet if student have enough information about selected organisation. If there is any doubt on provision of required information during perpetration of RAP then student should not select this topic for RAP as it impact on overall evaluation of information and overall grades of RAP.

*Feedback from project mentor is essential to get good grades in RAP.

Important Links:

Business Analysis Section of RAP

Reference Generator Link

Others


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