RISK MANAGEMENT IN PERSPECTIVE OF ACCOUNTING

Abstract

In today's business environment, increasing global sized company activities, the rapid developments in information and communication technology, advances in integrated flexible manufacturing systems, the shortening of product life cycle and the emergence of a very intense competitive environment cause to increase the risks companies may face. The management of companies is speedily being transformed into the management of risk. Achievement of management has become depending on the management of the risks companies encounter. Management of risks appears in large part of the limit of traditional entities and methods. Managing risk as part of the main management process called integrated risk management is vital for organizations management. Providing information based for decision making, accounting takes critical position in risk management. High-risk decisions require some sort of financial information presented to the management by accounting system. The objective of the study is to determine whether the accounting adding the value to the company for managing the risk. For this purpose, we examine the accounting regulations and IFRS in the point of risk management. In this study, we argue the positive and negative contributions of accounting to the risk management. We also argue the new proposals in accounting for the risk management approach in the perspective of recent developments.