Business Analysis Coso Enterprise Risk Management Framework

Angela Peng ACCT 501 Prof. Dennis A. Conrad January 23, 2016 COSO Enterprise Risk Management Framework Introduction Enterprises are exposed to various risks that decrease the chances of achieving their business goals both internally and externally. Internally, there are company politics and mismanagement. Externally, factors such as economic environment, regulations and technology influence risks. It is important for an enterprise to build framework for good risk management, which is â€Å"the process of identification, analysis and either acceptance or mitigation of uncertainty in investment decision-making.† (Investopedia, â€Å"Risk Management†) This paper is on a widely-accepted enterprise risk management framework created by Committee of Sponsoring Organizations of the Treadway Commission (COSO) in 2004 and its impact on Accounting Information System (AIS). Enterprise Risk Management Every company aims to utilize its resources efficiently to maximize the benefits of its stakeholders. With a satisfying rate of return, investors invest more in the company, customers trust the quality of its products, and employees keep a stable job. However, every enterprise is always faced with some degree of uncertainty. Uncertainty can be categorized as two types: risk and opportunity depending on how the enterprise treat the challenge. Take the online shopping as an example. Before the online retail became a mainstream, many retailers foresaw the opportunities online. 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