What is value at risk?

Article Abstract:

Value at risk (VAR) has rapidly become a popular risk assessment technique mainly because of its apparent simplicity. This approach provides a company insights into possible losses resulting from fluctuations in prices of the financial instruments it holds. Specifically, VAR, assesses the potential pre-tax loss incurred from unfavorable changes in interest rates or market rates over a specific holding period. The details of the technique will differ depending on the type of the rate change being measured. VAR has several advantages as a risk assessment tool, including its comprehensibility, its suitability for comprehensive risk limit setting and its ability to explain complex relationships in price movements. However, its apparent simplicity should not mislead users into thinking that it is without pitfalls. Its disadvantages and dangers are discussed.

Measurement, Risk (Economics), Value (Economics)

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CoCo stirs it up

Article Abstract:

The Criteria of Control Committee, or CoCo, of the Canadian Institute of Chartered Accountants has published guidelines for corporate directors. Titled 'Dealing with Risk in the Boardroom,' these guidelines suggest boards need to carefully analyze their processes and systems.

Management, Services, Corporate directors, Accounting, Canadian Institute of Chartered Accountants

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Steering a new profession

Article Abstract:

This article examines the attitudes of Antonio Gomez, president of the Instituto Mexicano de Contadores Publicos. New professional certification requirements, new roles for accounting professionals in Mexico, and the creation of a Commission on Best Practices are discussed.

Mexico, Practice, Accountants

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