Describe the process of risk management.

Risk Management is the process of understanding and managing the risks arising in an organisations as result of achievement of output, which is inevitable in nature.

Some of the types of risks that are to be managed are as follows:

• operational risk
• Market risk
• Foreign investment risk
• Credit risk
• Liquidity risk
• Asset backed risk ..etc

Now, the process of management of risk involves

• Risk identification:

It involves identifying risk exposures of an organisations, understanding their relevance in terms of their impact on survival of the business and prioritizing them, and determining an appropriate level of risk tolerance for the business.

• Risk Quantification:

Once the thorough understanding of risk has grown in the first step, the next step is to quantify in terms of probability of loss and quantum of loss. Here one needs to identify the amount of risk in term of loss, the project is carrying are to be identified on the basis of near estimation.

• Risk Treatment:

After the quantification, specific strategies are adopted to mitigate or treat risk in order of priority, means when one get to know the risk effect, should implement effective strategies, to mitigate the risk or to reduce the risk to the maximum extent possible.

• Monitoring Risk:

Finally, feedback on impact of risk mitigation is obtained to determine whether any modification of the risk management system is needed. This means that taken actions should be continuously monitored and controlled to check up their results. Risk monitoring enables the company to forecast the level of risk and prepare the company's actions in future

Finally Risk Management is a continuous process.