Operational Risk Management (ORM) and Financial Crises

About Course

Introduction

Operational risk management is a critical aspect of financial institutions and businesses worldwide. Understanding and mitigating these risks can protect organizations from significant financial losses and ensure sustainable operations. This course, “Operational Risk Management (ORM) and Financial Crises,” covers essential topics to equip students with the knowledge and skills needed to manage operational risks effectively and navigate financial crises.

Section 1: Operational Risk Management

This section introduces students to the foundational concepts of operational risk management. Students will learn about the processes and frameworks involved, including Risk Control Self-Assessment (RCSA) and scenario analysis. The section also explores various approaches such as the Basic Indicator Approach, Standardized Approach, and Advanced Management Approach. Understanding the types of operational risk losses and engaging in self-evaluation testing will help students develop a comprehensive risk management strategy.

Section 2: Global Economic Crisis – Liquidity Management

Students will delve into historical and contemporary economic crises, starting with the Great Depression of 1929 and the Financial Crisis of 2008. This section covers the causes, effects, and responses to these crises, emphasizing liquidity management. Key topics include securitization processes, credit default swaps, and the rescue measures undertaken during financial crises. Students will also learn about liquidity risk assessment, management principles, stress testing frameworks, and important ratios like the Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR).

Section 3: Corporate Governance

In this section, students will explore the principles and practices of corporate governance. The curriculum covers the fundamentals, various types of governance systems, and specific regulations such as the Sarbanes-Oxley Act (SOX) and the Dodd-Frank Act. Students will examine notable corporate governance failures and the principles set by the Basel Committee on Banking Supervision (BCBS). The influence of governance codes like the UK Corporate Governance Code is also discussed, providing a comprehensive understanding of how effective governance can prevent financial mismanagement and enhance organizational integrity.

Section 4: Fund Raising | IPOs and FPOs

This section is dedicated to fund raising through Initial Public Offerings (IPOs) and Follow-on Public Offerings (FPOs). Students will learn about the valuation techniques, assumptions, and financial statements involved in IPOs and FPOs. Topics such as profit and loss, depreciation, amortization, interest on loans, and working capital are covered in detail. The section also addresses the Discounted Cash Flow (DCF) valuation method, EBITDA, and PE valuation methods, as well as venture capital approaches. Understanding these concepts is crucial for evaluating the financial viability of raising capital through public offerings.

Section 5: Dodd-Frank Act Tutorials

This section provides an in-depth analysis of the Dodd-Frank Act, a significant piece of financial legislation. Students will study the Volcker Rule, types of swaps, derivatives regulation, and the securitization process. The curriculum covers Title VII requirements, credit rating agencies, capital and leverage, and bailout measures. The impact of the Dodd-Frank Act on private equity (PE) and hedge funds, executive compensation, and overall corporate governance is also discussed, providing a thorough understanding of this critical regulatory framework.

Section 6: Inter-Company Transaction Tutorials

In the final section, students will learn about inter-company transactions, including various types and examples such as downstream and upstream sales of goods, sales with associates, joint ventures, and depreciable asset sales. The section addresses the challenges and complexities these transactions present to organizations. By understanding these transactions, students will be better equipped to handle internal financial operations and maintain accurate financial records.

Conclusion

“Operational Risk Management (ORM) and Financial Crises” provides a comprehensive education on managing operational risks, understanding financial crises, and adhering to corporate governance and regulatory frameworks. By the end of the course, students will have developed the skills necessary to effectively manage financial risks and contribute to the stability and success of their organizations.

Enroll today to gain expertise in operational risk management and financial crisis response, and advance your career in finance and risk management.

What Will You Learn?

Fundamentals of Operational Risk Management: Understanding the core principles and concepts of operational risk management.
Familiarity with key frameworks and processes such as Risk Control Self-Assessment (RCSA) and scenario analysis.
Approaches to Risk Management: Detailed exploration of the Basic Indicator Approach, Standardized Approach, and Advanced Management Approach.
Learning the methods to apply these approaches in practical scenarios.
Types of Operational Risk Losses: Identifying and categorizing different types of operational risk losses. Strategies to mitigate and manage these losses
Self-Evaluation and Testing: Conducting self-evaluation tests to assess operational risk management proficiency. Continuous improvement through feedback
Understanding Historical Financial Crises: In-depth analysis of the Great Depression of 1929 and the Financial Crisis of 2008. Learning the causes, effects.
Liquidity Management: Principles and practices of liquidity management during economic crises. Techniques for liquidity risk assessment, stress testing.
Corporate Governance: Fundamentals and types of corporate governance systems.
Examination of regulatory frameworks like SOX, Dodd-Frank Act, and the UK Corporate Governance Code.
Fund Raising through IPOs and FPOs: Understanding the processes and valuation techniques for IPOs and FPOs.
Financial statement analysis, including profit and loss, cash flow, and balance sheet statements.
Regulatory Frameworks and Compliance: Comprehensive overview of the Dodd-Frank Act and its implications. Learning about swaps, derivatives regulation.
Inter-Company Transactions: Identifying and managing different types of inter-company transactions. Understanding the challenges and complexities involved.

Material Includes

14 hours on-demand video
Access on mobile and TV

Requirements

Basic Understanding of Finance and Economics: A foundational knowledge of finance and economics is beneficial to grasp the concepts of risk management and financial crises.
Familiarity with Financial Statements: Students should be comfortable reading and interpreting financial statements, including profit and loss statements, balance sheets, and cash flow statements.
Interest in Risk Management: An enthusiasm for learning about risk management practices and their applications in real-world scenarios.
Analytical Skills: Strong analytical skills to assess and evaluate various risk management approaches and financial data.
Basic Knowledge of Corporate Governance: An understanding of corporate governance principles and frameworks is helpful for sections related to governance and regulatory compliance.

Target Audience

Finance Professionals: Individuals working in finance roles who want to deepen their understanding of operational risk management and learn about historical and contemporary financial crises.
Risk Management Specialists: Professionals specializing in risk management seeking to enhance their skills and knowledge in identifying, assessing, and mitigating operational risks.
Economists and Financial Analysts: Economists and analysts looking to explore the impact of economic crises on liquidity management and corporate governance practices.
Students and Graduates: Students pursuing degrees in finance, economics, business administration, or related fields who aim to gain practical insights into risk management and financial stability.
Corporate Governance Practitioners: Practitioners and consultants in corporate governance who wish to understand the intricacies of risk management and regulatory compliance.
Regulatory and Compliance Officers: Individuals responsible for ensuring adherence to financial regulations and standards, particularly those involving risk management and crisis mitigation.
Investment Bankers: Professionals in investment banking seeking to comprehend the complexities of IPOs, FPOs, and liquidity management during financial crises.
Business Owners and Entrepreneurs: Entrepreneurs and business owners who want to safeguard their businesses against operational risks and understand the financial environment better.
Auditors and Accountants: Auditors and accountants interested in learning about the financial implications of risk management and how to evaluate an organization's risk posture.
Lifelong Learners: Individuals with a keen interest in finance and risk management who want to broaden their knowledge and stay updated with industry practices and historical financial events.
This course provides valuable insights and practical knowledge for anyone involved in or interested in the fields of finance, risk management, corporate governance, and economic analysis.

Course Curriculum

Operational Risk Management

Introduction to Operational Risk Management
Introduction to Operational Risk Management Continues
Operational Risk Management and Process
RCSA Process and Scenario Analysis
Basic Indicator Approach and Its Methods
The Standardized Approach
Advanced Management Approach
Types of Operational Risk Losses
Self Evaluation Testing

Global Economic Crisis – Liquidity Management

Introduction to Global Economic Crisis
Introduction to Global Economic Crisis Continue
Great Depression of 1929
Great Depression of 1929 Effect
Great Depression of 1929 Effect Continues
Financial Crisis of 2008
Securitization Financial Crisis Process
Credit Default Swaps
Credit Crunch of Financial Crisis
Credit Crunch of Financial Crisis Continues
Rescue on Financial Crisis of 2008
Liquidity Risk Assessment
Liquidity Management
Sources of Liquidity Management
Principles of Liquidity Management
Stress Testing and Framework
Indicators and Liquidity Reporting
Liquidity Coverage Ratio (LCR)
Liquidity Coverage Ratio (LCR) Continues
Net Stable Funding Ratio (NSFR)
Available Stable Funding (ASF) in NSRF
RSF and OBS in NSFR
Balance Sheet Governance
Conclusion of Liquidity Manager

Corporate Governance

Introduction to Corporate Governance
Fundamentals of Corporate Governance
Types of Corporate Governance
US Corporate Governance System
More on US Corporate Governance System
Examples of Corporate Governance Failures
Examples of Corporate Governance Failures Continues
Regulations
Principles by BCBS
Board Qualification Principle B y BCBS
Governance of Group Structure Principle By BCBS
More on Principle By BCBS
Influence of SOX on Corporate Governance
Impact Dodd Frank on Corporate Governance
UK Corporate Governance Code
Conclusion of Corporate Governance

Fund Raising | IPOs And FPOs |

Introduction to Fund Raising
Introduction to Fund Raising Continues
What is an IPO
Valuation Techniques
Assumptions in IPOs
Assumptions in IPOs Continues
Profit and Loss in Fund Raising
Depreciation in P and L
Amortization and EBIT in P and L
Interest on loan and Working capital in P and L
Taxation in P and L
Cash Flow Statement in Fund Raising
Balance Sheet Statement in Fund Raising
DCF Valuation in IPOs
EBITDA and PE Valuation Methos in IPOs
Venture Capital Methods in IPOs
What is FPOs
FPOs Assumption and Calculation
Conclusion of Fund Raising

Dodd-Frank Act Tutorials

Introduction to Dodd Frank Act
The Volcker Rule
The Volcker Rule Continues
Type of Swaps
Security Based Swap
Derivatives Regulation
Swap entities Types
Title VII requirements
Title VII requirements Continues
Securitization Process
Securitization Reforms
Credit Rating Agencies
Increased Potential Liability
Capital and Leverage
Examples of Capital
Bailouts
Bailouts Continues
PE and Hedge Funds
Executive Compensation
More on Executive Compensation
Conclusion
Self Test

Inter-Company Transaction Tutorials

Introduction to Intercompany Transactions
Types of Intercompany Transactions
Example of Downstream and Upstream Sale of Goods
Example of Partial Sale Sold to Third Parties
Example of Sales with Associates
Example of Joint Ventures
Example of Depreciable Asset Sale
Example of Depreciable Asset Sale Continues
Unrealised Sale Losses Example
Lateral Transactions Example
More on Lateral Transaction
Challenges and Complexities in Organizations
Conclusion of Intercompany Transactions