CDipFM Syllabus

Paper 4 - Risk Management 

The Syllabus outlines the content of the paper and how that content is examined.

Risk management has gained prominence in recent years as one of key managerial disciplines.

AIM

This paper develops knowledge and understanding of the main theories and frameworks of risk management. It enables managers to identify and manage risk in their organisations. After considering how a company can manage all aspects of risk through a corporate governance framework the paper then focuses on the particular area of financial risk . It looks in detail at the techniques and models available to measure and control all aspects of financial risk within an organisation.

CONTENT

General Risk Management

  • Risk policy
  • Risk audits and risk mapping
  • Reporting of risk management

Corporate Governance

  • Theoretical perspectives of corporate governance
  • Corporate governance frameworks, codes and systems
  • Role of the executive in corporate governance
  • Internal control: Internal audit, audit committees and organisational control
  • Implementation of corporate governance
  • Reporting of corporate governance

Management of Financial Risk

  • Risk measurement
  • Types of financial risk: gearing, interest rate risk, foreign exchange rate risk, credit risk, cash flow
  • Debt versus equity
  • The optimal capital structure
  • Dividend policy
  • Hedging techniques
  • Use of derivatives
  • Insurance

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