The Hilltop Companies is heavily focused on the risk management aspect of the financial services and real estate industries, as well as, the government financial sector agencies. Notwithstanding the specific risk management services that have been mentioned, we use our risk assessment and mitigation methodology to review other risk aspects as follows:
- Contract risks which are those risks related to compliance with all aspects of a contract (purchase, sales, performance, etc.)
- Investor compliance risks include all of the requirements for the seller (usually loans) and ultimate servicer
- Counter party risk measures the risk that a party to a transaction that you will or have entered into does not perform
- Operational risk includes the risks that arise from operating errors, backlogs, technology or hardware failures, process failures, personnel losses, etc.
- Internal controls risk is the basic issue addressed by SOX for public companies i.e. do the controls prevent and/or minimize financial misstatement, judgment errors, accounting errors, etc.
- Technology risks can be expansive but include at a minimum – hardware, network, or software failures, loss of control over applications, general controls, system implementations, etc.
In each case, our risk methodology focuses on identifying the following:
- What type of events/results can occur if the risk exists?
- What are the key elements to detecting the existence of such risk?
- What is the probability of the risk occurring?
- What is the frequency of the risk occurring?
- What specific controls are designed to prevent such risks?
- What specific controls are designed to identify the risk’s existence?
- What is the impact on the company – financially? Operationally? Technology? Etc.
- Are there any immediate and/or longer term remediation actions to take to minimize the risk?
Any consultant can ask these questions but the one that is highly experienced in your business will be the one that can answer these questions completely and accurately.