Financial Risk Management- Report Drafting Skills

 As a Financial Risk Manager you need to have good drafting skills.

While working on different projects I have learned that having good drafting skills is really crucial for you, when you evaluate someone's whole project and report all the progress and deficiencies.

What I have learned in all these processes will be very nicely written in this whole blog, mind that you should read the whole blog to have a top-hill view for best understanding.

Document Reading: 

Document reading is one of the important thing while making a report. As the whole report is backed by document signed or verified by appropriate authority. And document reading gives you a overview and good understanding of whole project. While a lot of terms that will come in front of you, which will be jargons and if you haven't read the document and understood every aspect of it, you will not be able to work on the report properly and this all will lead to mistakes and confusions.

Financials Preparation :

If you are a financial risk checker you need to be very well versed with financial statement reading and there making process. Being from a commerce background we have that feeling that we are very good in reading financial statements but we were all reading dummy statements till we were getting educated but in real world the things changes. A good practice of reading will allow you to understand the incoming and outgoing of money and any unregulated practice that will welcome financial risk.

This will for sure take time and your effort, but will pay you well once you understand these as these are building blocks or what we can say in simple words the basics.

Team Work :

A financial risk checking requires good coordination with other people, because as a human we are likely to miss things and  facts due to over work or frustration but another person have there own view point and may point out a lot of things that you missed which will likely to make your view better and more reliable with clarity.

This actually makes the report better and reliable plus increases your professionalism. 

Drafting and Writing:

Drafting and writing a report may look same but it is not anyone can write a report it truly easy. But when you draft it, you do it such a way that makes the document an important piece of paper for the different parties. A well drafted report actually gives a lot of decision, approvals and conflicts.

A badly drafted report will give nothing just bad professional review. Drafting has a lot of small detailing which makes it beautiful and more readable.

Readability of report is the most important thing when you are doing such top tier work.

Coming to main skills that I will help you to learn financial risk management are as follows-

Cost Evaluation of the project:

Here we make a trust and retention account which is in normal way called 'TRA'. It's a accounting summary of all the bank transaction done under different accounting head for example- Construction Account.

It has a whole transaction like a journal with debit and credit side and a balance column where you write the formula credit- debit+ the previous balance. The balance contains the first entry as opening balance and you last entry should match with the closing balance of that account.

As a lender the most important thing is getting back the amount they have lent that's where your role comes.

For this you need to have a hawk eye on the viability of the project. This can be seen by the after commercial operation revenue income of the project. 

The revenue comes into picture and then immediately start debt servicing that is returning the debt. This is where you do the major role that is seeing the viability of project by it's revenue.

Looking into the matter and understanding everything requires working into the project, I may not be able to provide you with every step but these are the basic skills you will require and based on this you will be able to understand the things that are different for different projects.

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