Risk Management Assignment on The Sprout Foundation

Question

Task The Sprout Foundation (TSF) Business Information Systems Manager, has accepted your advice as an external auditor proposing to undertake a risk assessment audit for the charity. It was tabled to the Board of Directors and, after much deliberation, the CFO has approved a reasonable budget to improve TSFs risk and security management posture.

You have been assigned to TSF to carry out an extensive risk assessment of the charity’s information management practices and information assets. Your task is to produce a 2500-word auditors report (in business report format). Your report should address the following components

Prepare a risk assessment (RA). To do so, you must

1. Clearly and concisely assesses TSFs value creation activities and strategic context in order to propose a target risk appetite and risk tolerance level for the charity.
2. Identify the key roles and responsibilities of individuals and departments within the organisation as they pertain to risk assessment.
3. Carefully audit the case evidence, undertake an inventory and identify information assets that includes both TSF’s most significant business information and the information systems that must be accounted for in any approach to risk management.
4. Identify risks: provide an analysis of the threats and vulnerabilities that pose the greatest risks to TSF’s most important information assets (information and systems).
5. Present a likelihood and impact analysis for the most significant risks you have identified, in doing so.
6. Prioritise the most significant risks for TSF and provides details in a risk assessment table.

Answer

Introduction
The Sprout Foundation discussed in this Risk Management Assignment generally supports two major concerns, which are the children as well, the environment. Their mission is mainly focussing the programs related to early childhood or preservation of our environment. The programs of the early childhood generally support the academic fitness or promoting healthy environments of mental health that will generate measurable results. The second thing that the Sprout Foundation handles discussed in this Risk Management Assignment is the various environmental projects that have a direct impact on the local environment condition. These impacts can be also mentioned as the treatment of the local water services or the air of the locality. The Headwaters Centre supports a dual mission in which they take care for the environment as well as the education for the youths.

1. The Sprout Foundation’s (TSF) value creation activities
The value chain discussed in this Risk Management Assignment is an important and powerful tool for the strategic management, which the authorities of the charity can use to integrate the TSF’s strategic activities and to organize them in a proper way that will affect the advantages in these competitive industries. This may be done with the higher prices or it may go through lower costs (Adams et al., 2017).

1.1 There are some value creations activities that are illustrated below that can be followed by the TSF leaders or the higher authorities:

• Inbound Logistics: In these kinds of activities of the Charity are generally associated with the delivery, storage and the distribution of the products. This can have the warehousing of their products, proper handling of the materials and the structures to store the data or information of the customers or clients. These things are mainly outsourced in the recent times.
• Operations: The operation includes the main transformation of an organization to transform the raw materials into usable products.
• Outbound Logistics: The most of the charitable trusts does the activities to distribute the products to the clients or buyers. The process of the outbound logistics includes the processing, storing, order scheduling and then distribution.
• Marketing & Sales: The activities of marketing and sales are carried out by the charitable trusts to make a way by which the buyers can approach. These kinds of activities include advertisement, pricing, promotions and many more.
• Services: To maintain a good relation with the clients the charitable trusts have to give the after sales services which can include maintenance, supply of the parts, backend support and trainings as well.

The strategic context of the TSF to maintain the risk tolerance to increase the level of the charitable trusts can include a firm infrastructure, a good human resource management, technology development, and the procurement activities that are done by the charitable trusts (Stojcic et al., 2016).

2. Responsibilities of the individual and the organization
A proper management of the risks are one of the most crucial functions of the charitable trusts authorities and the individual as well. The structured management will take the trust to a successful place. Generally, the owner or the authorities are responsible for the project risks as it is depended upon the authorities whether to execute the project or not. There are some major key roles or responsibilities of the individuals discussed in this Risk Management Assignment as well as the departments for the risk assessment, which are as follows:

The individual or the workers responsibilities-

• The individual or the workers have their right to consult for the necessary arrangements that are required by the organization.
• The individual have to participate in the programs of risk assessment.
• They can alert or discuss with their superiors or the departmental heads regarding the recognized risks.
• If there are any changes at the department, they should report to their managers.
• The individual should be informed of the risks of their health and safety and to have the necessary steps to reduce them.
• The workers or the individual must be involved to discuss about the preventive as well as the protective measures that are needed for the organization and to implement them.
• The workers must have the right to ask the authorities to take the appropriate steps and to submit the ideas to minimise the risks or hazards. They have to work together and whenever they identify any possible risks they need to discuss with the departmental heads or the owner of the charity as well.
• The individuals can also have the right to cooperate with the employer to help and to make sure that the working place is safe for everybody.
• Training and assessment programs are needed for the workers in order to make the measures implemented (Hogarth et al., 2018).
• They also must have the right to take care of the safety and security of other individuals as far as they can with the help of the training and assessment was done. This will help to cope up with the risks of the organization (Glennon, et al., 2017).

To run a successful charitable trust the departments also have some key roles or responsibilities. The department should prepare an organizing structure in order to complete their responsibilities. And they also have to do the risk assessment and have to implement the measures to maintain the health and safety of the employees and the individuals. It is also recommended to perform these tasks with a proper action plan to reduce the probable risks (Worth 2018.).

The action plan of the department should include the followings:

• Proper organizing, coordinating, and structuring of the assessments
• To complete the assessment special people should be appointed
• Persons who are doing the risk assessment can be both, the departments as well as the individuals
• The people may check the competence of the risk assessment by some of the abilities like understanding the approach toward risk assessment, the ability to implement the ideas and the understandings and must have the ability to understand the areas of risks where they can easily handle without any assistance.
• They need to consult with the representative of the workers for the various arrangements in order to carry out the risk assessments
• The department should provide the important information, resources and the training for those who are own individuals.
• Department will have the responsibilities to ensure proper communication between the assessors, this will vary with the relevance.
• The participation of the individuals in the workplace should be encouraged by involving the management of the organization.
• Proper arrangements should be done to determine the revision as well as reviewing the assessment of the risk
• The preventive methods are to be ensured for the result of the function
• The department should document all the risk assessment and this thing is to be ensured in all the steps (MacLean and Webber 2015).

3. TSF’s information system to approach the risk management
The TSF is generally a non-profit organization, which is working on the Pacific and the Asian countries. Their main motto is to provide an aid in raising a child and the environment of the locality. In order to run a charitable trust as discussed in this Risk Management Assignment they have to face many challenges and risks. To maintain the charity they need a proper management for the risks. There are several components of the risk management of an organization. There is a necessity for the management and the control of the charity, which is associated with the trustee body and their involvement in the risk management. This is for setting up the important parameters for the process and the revision with the consideration of the results (Yermack 2017).

By identifying the possible risks that the organization might face in this Risk Management Assignment, a proper and effective decision must be made to manage the risk. The trustees can generate an adequate framework that will help them to take decisions as per the level of the risks and to accept the process on a daily basis. There are several strategies for the charitable organization to manage the risk but the major four strategies are discussed below:

• Mitigation or proper management of the risks
• The organization can transfer the financial importance to the third parties or can share through the insurances or else outsourcing the consequences
• The authorities should not give up or stop the contract at a particular situation to increase the risk completely. This thing is to be avoided in any means to rise the further risks for the organization.
• When a risk has been accepted, it should not be avoided if the process is going on (Shrime et al., 2016).

The risk management models have some typical stages that will carry out the identification and the involvement of the risk management of a charitable organization. The proper model for the risk management should cover:

• Maintaining a risk policy
• Proper identification of the risks
• Risk assessment
• Evaluation of the action that is required for the risk management
• The monitoring and the risk assessment will have to be periodic.

4. Identification of the risks of the TSF
As there are numerous checklists available in the market now a day, the risk identification will be properly done by consulting the delegates who have the detailed knowledge in the charity operations. The identification of the risks generally focuses the major risks that are identified by the trustees (Shukla and Gupta 2017).

There are some examples discussed in this Risk Management Assignment that needs to be considered in the process of the identification of the risks, which are as follows:

• The main objectives and missions of the charitable organization
• The type or the volume of activity done by the charity
• The results which are needed by the charity
• Scale of the reputation of the charity including its funding bodies and supporters
• Assessment of the past issues that the organization has faced
• Operating structure for the charitable organization
• The comparison with the other similar bodies in the same area or size
• Certain examples of the management of the risks which are already prepared by the other organizations

As the TSF is a non-profit charitable organization, there are some of the risks that have been identified which are discussed below:

• Theft: There is risk of the theft issue of the funds for the TSF by an individual, a third party person or vendor and sometimes the clients. As the TSF has the limited source for the children and they are operating as a non-profit organization, if there is any theft issue occurred with the stocks and the funds there will be a huge loss for the organization as well as the trustees. The loss of the organization will directly affect the service of the organization. In order to implement the anti-theft structures the administrative costs will also be increased for the organization (Milicevic et al., 2016).
• Fraud during fundraising: Fraud parties may organize the hosting of the fundraising of a non-profit organization by keeping the money or the profits for the parties themselves. Later if this fraud is identified, then the trustee’s trust will be liable. This will include all the loss that will be incurred by the donators to the fraud fundraiser (Dickert et al., 2016).
• Reputation: Generally, all the non-profit organization is raised by the generosity of the other people; TSF is also included in the same place. TSF have to rely mostly with the positive perceptions of the public and the donor’s confidence. Losing the reputation will make TSF impossible to maintain its operations and donations. It can make the clients dissatisfied and could drive them away because the organization will develop a bad reputation or has generated negative things like mismanagement, frauds and harassments.
• Noncompliance: In order to maintain the tax-exempt role, the non-profit organizations that are operating are set by the specific rules given by the IRS. First of all the non-profitable organizations have to prove that they are utilizing the funds for a noble cause or charity and not for any kind of personal or political profits.
• Liability of the Board of Directors: The main responsible persons for maintaining the vision and mission of a non-profit organization are the directors and the officers. They are also responsible for management of the funds to carry out the charity and to ensure the majority of the funds that are coming from the donors are going to a noble cause. The Directors and the officers of the non-profit organizations take personal risks, which are associated with the liabilities and their professional works. They will be held liable for the risks, discriminations, thefts, and wrong allocation of the funds from the donors (Armin et al., 2016).
• Special Events: Various events are organised by the non-profit organizations such as community fairs and other fundraising activities. They present the safety, commodities, and the liability risks, which are of their own. Even if there is no damage or issues occurred for the charity, the company or the organization will still have the risk of losing money.
• Staff volunteering: The organizations take a light approach toward the screening and conducting proper training sessions for the volunteers and the paid staffs. They think that this will affect the amount of productive work given by the staffs or the volunteers. If any volunteer steals or cause any damage of the funds and public property, the non-profit organization will have to face the effect of the negligence and the cost for the claims will be much higher than the self-injuries.

5. The likelihood and the impact analysis for the identified risks

6. Classification of the risks according to the priority and the details

Conclusion
The TSF is one of the non-profit organizations, which is operating with a good reputation and service for the benefits of raising the children. The charitable organizations works by raising funds by the donors, they have to prove to certain authorities that they are working only for the welfare of the children of the society and not for any kind of political or personal profits. It is recommended in this Risk Management Assignment while working with several types of people and other organizations they face certain challenges and risks. Here in this Risk Management Assignment the possible way of the risk management has been described. Initially, the identification of the risk is most important thing in order to implement certain assessments to make a continuous growth in the competitive market. risk management assignments are being prepared by our risk management help experts from top universities which let us to provide you a reliable australian assignment help service.

References
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Armin, F., Becker, A., Dohmen, T.J., Huffman, D. and Sunde, U., 2016. The preference survey module: A validated instrument for measuring risk, time, and social preferences.

Dickert, S., Kleber, J., Västfjäll, D. and Slovic, P., 2016. Mental imagery, impact, and affect: A mediation model for charitable giving. PloS one, 11(2), p.e0148274.

Glennon, R., Hannibal, C. and Meehan, J., 2017. The impact of a changing financial climate on a UK local charitable sector: voices from the front line. Public Money & Management, 37(3), pp.197-204.

Hogarth, K., Hutchinson, M. and Scaife, W., 2018. Corporate philanthropy, reputation risk management and shareholder value: A study of Australian corporate giving. Journal of Business Ethics, 151(2), pp.375-390.

MacLean, T.L. and Webber, S.S., 2015. Navigating multiple identities across multiple boundaries: A cross-level model of organizational identification. Journal of Management Inquiry, 24(2), pp.156-173.

Milicevic, V., Colavita, G., Castrica, M., Ratti, S., Baldi, A. and Balzaretti, C.M., 2016. Risk assessment in the recovery of food for social solidarity purposes: preliminary data. Italian journal of food safety, 5(4).

Shrime, M.G., Sekidde, S., Linden, A., Cohen, J.L., Weinstein, M.C. and Salomon, J.A., 2016. Sustainable development in surgery: the health, poverty, and equity impacts of charitable surgery in Uganda. PloS one, 11(12), p.e0168867.

Shukla, R. and Gupta, S., 2017. Working and Organization of Mutual Fund Company. Journal of Accounting, Finance & Marketing Technology, 1(1), pp.22-30.

Stojcic, I., Kewen, L. and Xiaopeng, R., 2016. Does uncertainty avoidance keep charity away? comparative research between charitable behavior and 79 national cultures. Culture and Brain, 4(1), pp.1-20.

Worth, M.J., 2018. Nonprofit management: Principles and practice. Sage Publications.

Yermack, D., 2017. Donor governance and financial management in prominent US art museums. Journal of Cultural Economics, 41(3), pp.215-235.