...nrw | nrw | Risk Management Design -RV Dealer final report Risk Management Design -RV Dealer final report PART I 1. OBJECTIVE The objective of this report is to present a Risk Management Plan for the RV Retail and Depot facility located in Fountain, Colorado. The overall cost of the construction and restoration of the existing facility is approximately 1.5 million dollars. Level 1 | Level 2 | Level 3 | 1- RV Design | 1.1 Initiation | 1.2.1 Initial Meeting with General Contractor Construction Architects to discuss the project. 1.2.2 Present the project to the team 1.2.3 Prepare a proposal 1.2.4 Present proposal 1.2.5 Proposal Approval | | 1.2 Planning | 1.2.1 Create a preliminary scope of work1.2.2 Determine the project team1.2.3 Develop a project plan1.2.4 Submit the project plan1.2.5 Project Plan Approval | | 1.3 Execution | 1.3.1 Project Kickoff meeting1.3.2 Verify and validate user requirements1.3.3 Create a cost estimate1.3.4 Present cost estimate to customer1.3.5 Milestone: Cost Estimate Approval1.3.6 Select equipment 1.3.7 Draft initial design1.3.8 Milestone: Present 60% design to customer1.3.9 Receive comments from customer1.3.10 Review comments1.3.11 Complete design using the customer’s comments1.3.12 Create a punch list 1.3.12.1 Team Coordination Meeting1.3.13 Milestone: Present 95% Drawings to customer | | 1.4 Control | 1.4.1 Project Management1.4.2 Project Status...
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...A MODEL FOR RISK BASED PRICING FOR INFRASTRUCTURE FINANCING BY BANKS By Prof Ajay Pathak* Infrastructure development is the new buzzword for India Inc.Policy makers are putting emphasis on development of roads, ports, airports, and urban infrastructure to facilitate growth. The government is opening up private investment in the infrastructure through Special Purpose Vehicles (SPV). With the changing regulations, however, infrastructure finance so far has been untouched by the commercial banks. but this is the new avenue to gear up their fund based activities. With increased exposure in infrastructure, banks need to be cautious about the credit risks inherent in the projects with long gestation periods. It was found that infrastructure development has a high correlation with the macroeconomic factors like GDP growth rate of the country. Such macroeconomic trends actually influence income generation and timely recovery of the credit extended. So for greater risk sensitivity a model pricing mechanism has been developed to address the macroeconomic changes in the economy for better risk management. It is an obvious fact that risk is inherent in every action. In extending credit to other parties one of the main risks of the Bank is Credit Risk. The possibility of losses associated with diminution in the credit quality of borrowers/counter parties is called credit risk. In a simpler way, credit risk may be defined...
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...2012 if it changed to a JIT production system. (10 marks) (b) (i) Calculate the average direct labour cost per batch of the first eight batches. (2 marks) (ii) Calculate the direct labour cost of the eighth batch. (3 marks) (iii) Prepare a statement showing the contribution expected from this new product over its lifetime, assuming that the selling price remains at $75 per unit. (5 marks) (iv) Explain Kaizen costing and how it may be used by RTY to increase the contribution it earns from the new product during its lifetime. (5 marks) (Total for Question One = 25 marks) Rationale This question examines several learning outcomes from Section B of the Performance Management syllabus. Part (a) examines learning outcome B1(b) 'evaluate the impacts of just-in-time production, the theory of constraints and total quality management on efficiency, inventory and cost'. Part (b) (i), (ii) and (iii) examines learning outcome B1(e) 'apply learning curves to estimate time and cost for new products and services'. Part (b) (iv) examines learning outcome B1(c) 'explain the concept of continuous improvement and...
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...Quantitative Risk Assessment /584 Quantitative Risk Assessment Mallinckrodt Pharmaceuticals is a global specialty biopharmaceutical company that develops, manufactures, markets and distributes specialty biopharmaceutical products. The CMDS (contrast media and medical devices sector) was recently sold to Guerbet Group a research centered pharmaceutical company. This transition helps Mallinckrodt to concentrate their future vision to the acquisition of biopharmaceutical products companies which places them in a very complex and competitive environment with other major pharmaceutical companies. A Quantitative Risk Assessment for the proposed project will estimate the techniques and some of the key variables to determine the risks and losses that will help to present a stronger case for Quality and Regulatory implementation and the personnel improvement required to management. Mallinckrodt has encountered issues with quality and regulatory concerning controlled substances due to employee cutbacks in the manufacturing plants since the CMDS was sold. Revision of Project Background The proposed project will help define the personnel needed and quality and regulatory requirements needed to run a leaner manufacturing process and address the delivery backlog issues promptly. The success of the proposed project will help the company gain the edge they need to compete in the aggressive competitive opioid and rare disease medicine field. The quantitative risk assessment...
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...Introduction to CreditMetrics™ The benchmark for understanding credit risk New York April 2, 1997 • • • A value-at-risk (VaR) framework applicable to all institutions worldwide that carry credit risk in the course of their business. A full portfolio view addressing credit event correlations which can identify the costs of over concentration and benefits of diversification in a mark-to-market framework. Results that drive: investment decisions, risk-mitigating actions, consistent risk-based credit limits, and rational risk-based capital allocations. J.P. Morgan Co-sponsors: Bank of America Bank of Montreal BZW Deutsche Morgan Grenfell KMV Corporation Swiss Bank Corporation Union Bank of Switzerland Table of Contents 1. Introduction to CreditMetrics 2. The case for a portfolio approach to credit risk 3. The challenges of estimating portfolio credit risk 4. An overview of CreditMetrics methodology 5. Practical applications 3 9 12 14 30 Introduction to CreditMetrics Copyright © 1997 J.P. Morgan & Co. Incorporated. All rights reserved. J.P. Morgan Securities, Inc., member SIPC. J.P. Morgan is the marketing name for J.P. Morgan & Co. Incorporated and its subsidiaries worldwide. CreditMetrics™, CreditManager™, FourFifteen™, and RiskMetrics™ are trademarks of J.P. Morgan in the United States and in other countries. They are written with the symbol ™ on their first occurance in the publication, and as CreditMetrics, CreditManager, FourFifteen or RiskMetrics thereafter...
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...competitive advantage over its rivals. The importance of internal controls and risk management is highly recognized at Wellfleet. Wellfleet aligns their risk management to Basel II Accord and guidelines. The bank has a unique risk profile and warranted risk-taking discipline. The bank aggressively pursues growth in the large-scale transformational deals. The bank wants to grow aggressively but with balance. As the bank grows, they need to make sure that their risk infrastructure keeps apace with the business opportunities. A consequence for their growth strategy, the bank is facing several risks, such as legal/regulatory risk, credit risk, business risk and operational risk. The legal/regulatory risk is presented by changing international regulatory rules, the bank is required to set aside and manage capital reserves in response to these new regulatory rules. The global economy is becoming more competitive and Wellfleet bank is growing against a risky environment. Companies may default and that present credit risk to the bank. Wellfleet has more strict risk control than its competitors, and pay more attention to the risk modeling rather than the holistic view of the company requesting the facility or industries it operates in. The business risk followed by key lending decisions that the bank makes may result in an opportunity loss for revenue from current/potential customers. The power of the risk management function caused lots of tension in the corporate banking unit. The bank has...
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...test and experience test 48 CHAPTER 5- Assessment methodology for assignment of exposures to grades or pools 51 CHAPTER 6- Assessment methodology for definition of default 56 CHAPTER 7- Assessment methodology for rating systems design, operational details and documentation 60 CHAPTER 8- Assessment methodology for risk quantification 71 CHAPTER 9- Assessment methodology for assignment of exposures to exposure classes 90 CHAPTER 10- Assessment methodology for stress test used in assessment of capital adequacy 93 CHAPTER 11- Assessment methodology of own funds requirements calculation 96 CHAPTER 12- Assessment methodology of data maintenance 102 CHAPTER 13- Assessment methodology of internal models for equity exposures 106 CHAPTER 14- Assessment methodology for management of changes to rating systems 111 CHAPTER 15- Final provision 112 1. General Rules * Proportionality Principle: Competent authorities, to the extent appropriate, shall apply additional methods which are relevant to the nature, size and degree of complexity of the institution´s business and organizational structure. * Quality: * Is it approved at the appropriate management level? * Are there policies in place outlining specific standards to ensure high quality of internal documentation?...
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...This article can be divided into four parts, explaining the risks of Wellfleet Bank, additional risks after new focus and recruitment, calculation for the proposal and analysis of risk management processes in order. Risks of Wellfleet Bank Given its strategy, Wellfleet bank may face several kinds of risks: credit risk, country or sovereign risk, regulatory risk, compartmentalized risk and market risk. Credit risk was the first one that Wellfleet bank may have. Credit risk arises from the possibility that promised cash flows held by the bank, such as loans or bonds, will not be paid in full. According to the case, the number of proposals for the Group Credit Committee to project increased from 220 (for 2008) to over 300 (for 2009). What’s more, the largest credit proposals were nearing $1 billion each and each of these large-scale credit applications involved a mega-risk. As per the mantra of the bank, “If a billion-dollar deal went wrong, it could sink the ship.” Secondly, regardless of its customer base, which was most of its 6 million retail customers and 15,000 corporate clients resided out of the U.K., Wellfleet’s headquarter was still in London and it complied with regulations and standards like any other U.K.-based banks. Wellfleet considered the “first-world compliance standards” as an important competitive advantage over local rivals in emerging markets. But the risk was its repayments from the local borrowers might be interrupted by the interference of foreign governments...
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...Initially, the VaR has been anticipating to quantify the available risks in derivatives markets, but it has grown widely and it has now been applied in measuring all kinds of risks, primarily credit and market risks. It also developed from a tool that quantifies risk to a tool that is applied in active risk management. Today VaR has shifted beyond application in financial institutions. In the beginning, companies with largely exposed to financial markets used other kinds of activities before spreading to other businesses. Today, an ever-growing numbers of individual businesses apply and appreciate VaR as an effective tool for quantifying financial risksKrause (2003). This trend is evidently aided by the fact that non-specialists easily understand VaR. The risks of the prevalent use of VaR are an overdependence on the results it gives, misconception, and even abuse. It is as a result that, essential individuals using VaR understand its problems and limitations. In this paper, I will explore in depth these constraints, which unluckily do not mark prominently. To begin with, the VaR estimate is founded on precedent data, that is, it uses past distribution of effects of the investment. However, to calculate the peril of an investment, it is of no concern how big this risk has been in the earlier period, but fairly on how much exposure there is within the existing period; therefore, the future distribution of outputs would be the appropriate to consider. As long as the division...
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...Thesis for the Degree of Master of...? INCORPORATING LIQUIDITY RISK INTO VAR MODEL TO IMPROVE RISK MANAGEMENT AND APPLYING THE LIQUIDITY ADJUSTED VALUE AT RISK MODEL ON VIETNAMESE STOCK MARKET Student: Ten truong: Ten khoa hoc: September, 2012 INCORPORATING LIQUIDITY RISK INTO VAR MODEL TO IMPROVE RISK MANAGEMENT AND APPLYING THE LIQUIDITY ADJUSTED VALUE AT RISK MODEL ON VIETNAMESE STOCK MARKET by student Avised by Ten giao su Submitted to Ten khoa of Ten truong in the partial fulfilment of the requirements for the degree of Master of ...? Dissertation Committee ...Ten thanh vien hoi dong ABSTRACT In this paper, based on Bangia et. al (1999) Liquidity Adjusted Value at Risk, an explanation and demonstration for the importance of integrate liquidity risk component into Value at Risk Model are presented. The component is considered to be resulted from the exogenous liquidity risk, indeed, the bid-ask spread of a stock or a portfolio. This research is conducted from the analysis of an estimation of Value at Risk (VaR) and Liquidity adjusted Value at Risk for two portfolios containing stocks that are currently trading on Vietnamese Stock Market. After applying the Bangia Model to calculate, the backtesting will be executed to check the accuracy level of the results. The difference between the results of two portfolios, according to separate approaches will be the evidence to reach the conclusion of the research. Table of Contents List of...
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...Enterprise Risk Management at Hydro One Case Study Strategic Objective * Be the best transmission and distribution business in North America; * Implement Enterprise Risk Management by a risk-based investment planning system * 90% customer satisfaction Risk * Loss of competitiveness and volatility of financial markets; * Employee safety issues * Uncertainty in government * Equipment failure * Environment issues Strength The risk assessment process fully involves every aspect of the business. Meanwhile, instead of using a probability test to identify the potential outcomes and associated probabilities, Hydro One chose to focus on “worst credible” outcome within a given time frame and its associated probability of occurrence. It helped the group to assess the magnitude of a given risk, its probabilities and the strength of existing controls. This simple, qualitative approach has proven to be a practical and efficient way to focus on major risks while avoiding excessive detail and complex calculations. Besides, the risks are identified in a 2 to 3 year time frame. This forward looking way gets mangers to think over a 2 to 3 year horizon. Once risks and controls are assessed, a manager will be assigned to be the “risk owner” to develop specific plans to mitigate the risk, that is, a rank-ordered list of “residual risks” is assembled. Also, risk management staff do not attend internal audit meetings and the information...
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...joined Starbucks as the director of operations and marketing, and Starbucks began selling coffee to restaurants and baristas in 1982.” Once 1988 came around Starbucks operated about 33 stores and today Starbucks operates about 17,651 stores in 55 countries. Team B will discuss the relationship between strategic and financial planning. The subject of this report is Starbucks, and there are several topics we have touched on. First, Team B will describe a strategic planning initiative for Starbucks. Secondly, Team B will explain how the initiative will affect the financial planning at Starbucks. Team B will also explain how the initiative will affect costs and sales. Finally, Team B will explain the risks associated with the initiative and the financial effects these risks may have. Starbucks Strategic Plan Strategically, Starbucks has increased the drive through retail portion of the stores to better serve their loyal customers through convenience and by continuing to provide the Starbucks experience. Through the implementation of the Starbucks card, which can be used globally, and the growth of the healthy additional...
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...assessment of formal operational risk disclosure in relation to the vertically integrated poultry producer Pilgrim’s Pride Corporation (PPC). Overall PPC establishes fair reporting of operational risks, however, these disclosures will be evaluated based on the risk related information formally disclosed in the company’s financial statements in contrast with evaluation of risk present considering bias of company risk measurement as well as assessment of risk applicable as determined from informal and third party sources. This report will specifically analyze risk in this way in regards to market risk, supply chain risk, country risk and environmental risk applicable to and disclosed by PPC. MARKET RISK PPC experiences significant to market risk in its operations. The following analyzes this risk in regards to its three main components: competitive rivalry, segments and seasonality. Competitive Rivalry PPC recognizes competition as a significant risk to its operations in its 2012 10-K. The company notes that the market remains fairly concentrated, with the four main chicken producers accounting for over 50% of the US industry’s market share. The company also discloses that it operates as the second largest in the US with a market share of 17.4%.1 As a result PPC discloses this market concentration and competitive rivalry as significant risk factors to the company. PPC does not disclose any additional data for the analysis of this risk in its 10-K. This is not uncommon...
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...Risk Based Capital (Basel II) for Banks in Bangladesh: A straightforward Journey Abu Hena Mohd. Razee Hassan K. M Abdul Wadood Abstract Banks operating in Bangladesh are much enthusiastic for maintaining risk based capital in line with Basel II. Self audit report 2008 on compliance with Basel Core Principles (BCPs) shows, Operational independence of Bangladesh Bank, supervisory tools, existing prudential regulations for core risk management as introduced in banking industry by BB has developed an environment is favorable for implementing Basel II. Bangladesh Bank (BB) has commenced the implementation of Basel II from January 2009 and has provided banks guideline for computing Minimum Capital requirement (MCR) on the basis of Risk Weighted Assets (RWA). The techniques of calculation of RWA will follow Standardized Approach for Credit Risk, Standardized (Rule Based) Approach for Market Risk and Basic Indicator Approach for Operational Risk. In Standardized Approach risk weight of exposures will be differentiated based on external credit assessments and the risk weights will be inversely related to the credit rating of the counter party. Calculation of RWA under Standardized Approach is supported by External Credit Assessment Institute (ECAI). The recognition process of BB will ensure ECAIs eligibility criteria as required by the Basel II document. In addition to computing MCR banks have to calculate adequate capital with the procedure as stated in the section second pillar or...
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...Monitor firmwide revenues and non-compensation expenses - Evaluate new acquisitions, structured trades and other transaction to determine approporiate accounting treatment. IMD Controllers - prepare global regulatory filings, AUM and revenue reporting Product Controllers and Funding Controllers - P&L calculations, reporting, attribution and reporting to desks - PRice Verification and management reporting - Account and monitor forthe firm's secured and unsecured financing activitis Regulatory Controllers - Calcualte and review Firl's capital ratios - Analyze and report regulatory capital - Prepare global regulatory filings -Coordinatre teh capital computations for "GS" Group and regulated legal entities Market Risk Analysis is responsible for measuring, analyzing and reporting market risk, including monitoring adherence to limits. Varieties of quantitative measures are used, including Value at Risk (VaR) and stress tests. Much focus is given to liquidity and risk concentration. This team is at the center of the firm's daily trading activities and looks at all businesses and asset classes across the firm globally. Market Risk Analysis is looking for pro-active and driven people with a great eye for detail, strong analytical skills and a strong desire to truly understand the...
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