So You Want to Be An Audit Risk Management Analyst?

What exactly is an Audit Risk Management Analyst? An Audit Risk Management Analyst is the
person in an organization who is tasked with trying to head off or reduce the chances that
the organization will suffer financial losses in the future due to perceived risks. To do
that job properly, the Analyst has to understand risk management and what it entails.

One way that an Audit Risk Management Analyst can help is by finding ways to retain
valuable, skilled and experienced employees so that employee attrition does not result
(meaning, employees do not leave the organization for better-paying jobs.) If the
organization is involved in sales, the Analyst has to find ways to prevent possible
financial losses from being incurred if sales are way below quotas. These are just some
examples, but basically an Analyst has to determine potential risks, compute just how
harmful these risks can be financially to the organization, and use proper risk management
techniques so that minimal to zero losses will eventually be incurred due to those risks.

In properly implemented risk management programs, the processes which are present are Risk
Avoidance, Risk Reduction, Risk Retention, and Risk Transfer. In Risk Avoidance, the
organization will stop doing certain tasks completely so that the risk will not occur or
impact on the organization. In Risk Reduction, the organization adopts a preventive
attitude so that the risk encountered will have minimal to zero impact on the organization.
In Risk Retention, the organization simply absorbs all losses from the risk as they come.
But in Risk Transfer, the organization attempts to buffer itself from financial losses by
buying insurance policies.

It is never possible to completely prevent your organization from being affected by risks,
but it is the job of the Audit Risk Management Analyst to attempt to do his best to do so.
Without such a person (or people) in an organization, the organization would crumple under
the impact of financial losses and simply fold.