The risk management process involves both internal and external analysis. The first part of the process involves identifying and prioritizing the financial risks facing anization and understanding their relevance. It may be necessary to examine anization and its products, management, customers, suppliers, competitors, pricing, industry trends, balance sheet structure, and position in the industry. It is also necessary to consider stakeholders and their objectives and tolerance for risk. Once a clear understanding of the risks emerges, appropriate strategies can be implemented in conjunction with risk management policy. For example, it might be possible to change where and how business is done, thereby reducing anization ’s exposure and risk. Alternatively, existing exposures may be managed
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