Search results for: credit risk management

Authors: Sandija Zeverte-Rivza, Irina Pilvere, Baiba Rivza

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The use of renewable energy sources incl. biogas has become topical in accordance with the increasing demand for energy, decrease of fossil energy resources and the efforts to reduce greenhouse gas emissions as well as to increase energy independence from the territories where fossil energy resources are available. As the technologies of biogas production from agricultural biomass develop, risk assessment and risk management become necessary for farms producing such a renewable energy. The need for risk assessments has become particularly topical when discussions on changing the biogas policy in the EU take place, which may influence the development of the sector in the future, as well as the operation of existing biogas facilities and their income level. The current article describes results of the risk assessment for farms producing biomass from agriculture biomass in Latvia, the risk assessment system included 24 risks, that affect the whole biogas production process and the obtained results showed the high significance of political and production risks.

Keywords: biogas production, risks, risk assessment, biosystems engineering

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Authors: R. Niranchana, K. Meena Alias Jeyanthi

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As a result of the present climate change dilemma, the energy balancing strategy is to construct a sustainable environment has become a top concern for researchers worldwide. The environment itself has always been a solution from the earliest days of human evolution. Carbon capture begins with its accurate estimation and monitoring credit inventories, and its efficient use. Sustainable urban planning with deliverables of re-use energy models might benefit from assessment methods like biomass carbon credit ranking. The term "biomass energy" refers to the various ways in which living organisms can potentially be converted into a source of energy. The approaches that can be applied to biomass and an algorithm for evaluating carbon credits are presented in this paper. The micro-climate evaluation using Computational Fluid dynamics was carried out across the location (1 km x1 km) at Dindigul, India (10°24'58.68" North, 77°54.1.80 East). Sustainable Urban design must be carried out considering environmental and physiological convection, conduction, radiation and evaporative heat exchange due to proceeding solar access and wind intensities.

Keywords: biomass, climate assessment, urban planning, multi-regression, carbon estimation algorithm

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Authors: Som Pal Baliyan

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The purpose of this quantitative study was to analyze farm management skills in broiler poultryproducers in Botswana. The study adopted a descriptive and correlation research design. The population of the study was the poultry farm operators who had been in broiler poultry farming at least for two years. Based on the information from literature, a questionnaire was constructed for data collection on seven areas of farm management skills namely; planning skills, accounting and financial management skills, production management skills, product procurement and marketing skills, decision making skills, risk management skills, and specific technical skills. The validity and reliability of the questionnaire were accomplished by a panel of experts and by calculating the Cronbach’s alpha coefficient, respectively. Data were collected through a survey of 60 randomly sampled poultry farm operators in Botswana. Data were analyzed through descriptive statistical tools whereby the level of farm management skills were determined by calculating means and standard deviations of the management skills among the broiler producers. The level of farm management skills in broilers producers was discussed. All the seven farm management skills were ranked based on their calculated means. The specific technical skills and risk management skills were the highest and the lowest ranked farm management skills, respectively.Findings revealed that the broiler producers had skills above the average level only in specific technical skills whereas the skill levels in the remaining six farm management skills under study were found below the average level. This prevailing low level of farm management skills can be justified asthe cause of failure or poor performance of the broiler poultry farms in Botswana. Therefore, in order to improve the efficiency and productivityin broiler production in the country, it was recommended that the broiler poultry producers should be adequately trained in areas of planning skills, financial management skills, production management skills, product procurement and marketing skills, decision making skills and risk management skills.

Keywords: poultry production, broiler production, management skills, levels of skills

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Authors: Umesh Kumar Singh, Chanchala Joshi

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With increasing dependency on IT infrastructure, the main objective of a system administrator is to maintain a stable and secure network, with ensuring that the network is robust enough against malicious network users like attackers and intruders. Security risk management provides a way to manage the growing threats to infrastructures or system. This paper proposes a framework for risk level estimation which uses vulnerability database National Institute of Standards and Technology (NIST) National Vulnerability Database (NVD) and the Common Vulnerability Scoring System (CVSS). The proposed framework measures the frequency of vulnerability exploitation; converges this measured frequency with standard CVSS score and estimates the security risk level which helps in automated and reasonable security management. In this paper equation for the Temporal score calculation with respect to availability of remediation plan is derived and further, frequency of exploitation is calculated with determined temporal score. The frequency of exploitation along with CVSS score is used to calculate the security risk level of the system. The proposed framework uses the CVSS vectors for risk level estimation and measures the security level of specific network environment, which assists system administrator for assessment of security risks and making decision related to mitigation of security risks.

Keywords: CVSS score, risk level, security measurement, vulnerability category

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Authors: Pui Yong Leo, Normy Maziah Mohd Said

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Change of global economy landscape and business environment has led to companies’ decision to go global and enter international markets. As the companies go beyond the comfort zone (i.e. investing in the home country), it is important to ensure a comprehensive risk assessment is carried out. This paper describes a standardized approach for international investment, ensuring identification of risk, risk appetite, risk rating, risk treatment and mitigation plans for respective international investment proposal. The standardized approach is divided into three (3) stages as follows: Stage 1 – Preliminary Risk profiling; with the objective to gauge exposure to countries and high level risk factors as first level assessment. Stage 2 – Risk Parameters; with the objective to define risk appetite for the international investment from the perspective of likelihood and impact. Stage 3 – Detailed Risk Assessments; with the objectives to assess in detail any triggered elements from Stage 1, and project specific risks. The final output will include the mitigation plans for the identified risks for the total investment. Example will be given in this paper to show how comprehensive risk assessment is carried out for an international investment in power energy sector.

Keywords: international investment, mitigation plans, risk appetite, risk assessment

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Authors: Ritsuko Kawasaki (Aiba), Takeshi Hiromatsu

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Management is required to understand all information security risks within an organization, and to make decisions on which information security risks should be treated in what level by allocating how much amount of cost. However, such decision-making is not usually easy, because various measures for risk treatment must be selected with the suitable application levels. In addition, some measures may have objectives conflicting with each other. It also makes the selection difficult. Moreover, risks generally have trends and it also should be considered in risk treatment. Therefore, this paper provides the extension of the model proposed in the previous study. The original model supports the selection of measures by applying a combination of weighted average method and goal programming method for multi-objective analysis to find an optimal solution. The extended model includes the notion of weights to the risks, and the larger weight means the priority of the risk.

Keywords: information security risk treatment, selection of risk measures, risk acceptance, multi-objective optimization

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Authors: M. V. Shivaani, P. K. Jain, Surendra S. Yadav

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Risk management has been gaining extensive focus from international organizations like Committee of Sponsoring Organizations and Financial Stability Board, and, the foundation of such an effective and efficient risk management system lies in a strong risk governance structure. In view of this, an attempt (perhaps a first of its kind) has been made to develop a risk governance index, which could be used as proxy for quality of risk governance structures. The index (normative framework) is based on eleven variables, namely, size of board, board diversity in terms of gender, proportion of executive directors, executive/non-executive status of chairperson, proportion of independent directors, CEO duality, chief risk officer (CRO), risk management committee, mandatory committees, voluntary committees and existence/non-existence of whistle blower policy. These variables are scored on a scale of 1 to 5 with the exception of the variables, namely, status of chairperson and CEO duality (which have been scored on a dichotomous scale with the score of 3 or 5). In case there is a legal/statutory requirement in respect of above-mentioned variables and there is a non-compliance with such requirement a score of one has been envisaged. Though there is no legal requirement, for the larger part of study, in context of CRO, risk management committee and whistle blower policy, still a score of 1 has been assigned in the event of their non-existence. Recognizing the importance of these variables in context of risk governance structure and the fact that the study basically focuses on risk governance, the absence of these variables has been equated to non-compliance with a legal/statutory requirement. Therefore, based on this the minimum score is 15 and the maximum possible is 55. In addition, an attempt has been made to explore the determinants of this index. For this purpose, the sample consists of non-financial companies (429) that constitute S&P CNX500 index. The study covers a 10 years period from April 1, 2005 to March 31, 2015. Given the panel nature of data, Hausman test was applied, and it suggested that fixed effects regression would be appropriate. The results indicate that age and size of firms have significant positive impact on its risk governance structures. Further, post-recession period (2009-2015) has witnessed significant improvement in quality of governance structures. In contrast, profitability (positive relationship), leverage (negative relationship) and growth (negative relationship) do not have significant impact on quality of risk governance structures. The value of rho indicates that about 77.74% variation in risk governance structures is due to firm specific factors. Given the fact that each firm is unique in terms of its risk exposure, risk culture, risk appetite, and risk tolerance levels, it appears reasonable to assume that the specific conditions and circumstances that a company is beset with, could be the biggest determinants of its risk governance structures. Given the recommendations put forth in the paper (particularly for regulators and companies), the study is expected to be of immense utility in an important yet neglected aspect of risk management.

Keywords: corporate governance, ERM, risk governance, risk management

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Authors: Sudipto Sarkar

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Capital is the primary fuel for starting and running a business. Since capital is crucial for every business, entrepreneurs must successfully acquire adequate capital for executing their projects. Sources for the necessary capital for entrepreneurs include their own personal funds from existing bank accounts, or lines of credit or loans from banks or financial institutions, or equity funding from investors. The most commonly selected source of capital is a bank loan. However, acquiring a loan by any entrepreneur requires adhering to strict guidelines, conditions and norms. Because not only they have to show evidence for viability of the project, but also the means to return the acquired loan. On the bank’s part, it requires that every loan officer performs a thorough credit appraisal of the prospective borrowers and makes decisions about whether or not to lend money, how much to lend, and what conditions should be attached to it. Moreover, these credit decisions in general were often based on biases, analytical techniques, or prior experience. A loan can either turn out to be good or poor, irrespective of what type of credit decisions were followed. However, based on prior experience, the loan officers seem to differentiate between a good and a bad loan by examining the borrower’s credit history, pattern of borrowing, volume of borrowing, frequency of borrowing, and reasons for borrowing. As per an article written by Maureen Wallenfang on postcrescent.com dated May 10, 2010, it is observed that borrowers with good credit, solid business plans and adequate collateral security were able to procure loans very easily in the Fox Valley region. Since loans are required to run businesses, and also with the propensity of loans to become bad, loan officers tend to be very critical and cautious before approving and disbursing the loans. The pressure to be critical and cautious, at least partly, is a result of increased scrutiny by the Securities and Exchange Commission. As per Wall Street Journal (Sidel & Eaglesham, March, 3 2011, online), the Securities and Exchange Commission scrutinized banks that have restructured troubled loans in order to make them appear healthier than they really are. Therefore, loan officers’ loan criteria are of immense importance for entrepreneurs and banks alike.

Keywords: entrepreneur, loans, marketing, banks

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Authors: Siddharth Krishnaswamy

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Problem Statement: Currently, when analyzing household food security, the most commonly studied food access indicators are household income and expenditure. Larger studies do take into account other indices such as credit and employment. But these are baselines studies and by definition are conducted infrequently. Food security analysis for access is usually dedicated to analyzing income and expenditure indicators. And both these indicators are notoriously inconsistent. Yet this data can very often end up being the basis on which household food access is calculated; and by extension, be used for decision making. Objectives: This paper argues that along with income and expenditure, credit and debit information should be collected so that an accurate analysis of household food security (and in particular) food access can be determined. The lack of collection and analysis of this information routinely means that there is often a “masking” of the actual situation; a household’s food access and food availability patterns may be adequate mainly as a result of borrowing and may even be due to a long- term dependency (a debt cycle). In other words, such a household is, in reality, worse off than it appears a factor masked by its performance on basic access indicators. Procedures/methodologies/approaches: Existing food security data sets collected in 2005 in Azerbaijan, 2010 across Myanmar and 2014-15 across Uganda were used to support the theory that analyzing income and expenditure of a HHs and analyzing the same in addition to data on credit & borrowing patterns will result in an entirely different scenario of food access of the household. Furthermore, the data analyzed depicts food consumption patterns across groups of households and then relates this to the extent of dependency on credit, i.e. households borrowing money in order to meet food needs. Finally, response options that were based on analyzing only income and expenditure; and response options based on income, expenditure, credit, and borrowing – from the same geographical area of operation are studied and discussed. Results: The purpose of this work was to see if existing methods of household food security analysis could be improved. It is hoped that food security analysts will collect household level information on credit and debit and analyze them against income, expenditure and consumption patterns. This will help determine if a household’s food access and availability are dependent on unsustainable strategies such as borrowing money for food or undertaking sustained debts. Conclusions: The results clearly show the amount of relevant information that is missing in Food Access analysis if debit and borrowing of the household is not analyzed along with the typical Food Access indicators that are usually analyzed. And the serious repercussions this has on Programmatic response and interventions.

Keywords: analysis, food security indicators, response, resilience analysis

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Authors: Amany A. Ragheb, Ghada Ragheb, Abd ElRahman A.

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Egypt has a countless heritage of mansions, castles, cities, towns, villages, industrial and manufacturing sites. This richness of heritage provides endless and matchless prospects for culture. Despite being famous worldwide, Egypt’s heritage still is in constant need of protection. Political conflicts and religious revolutions form a direct threat to buildings in various areas, historic, archaeological sites, and religious monuments. Egypt has witnessed two revolutions in less than 60 years; both had an impact on its architectural heritage. In this paper, the authors aim to review legal and policy framework to protect the cultural heritage and present the risk management strategy for cultural heritage in conflict. Through a review of selected international models of devastated architectural heritage in conflict zones and highlighting some of their changes, we can learn from the experiences of other countries to assist towards the development of a methodology to halt the plundering of architectural heritage. Finally, the paper makes an effort to enhance the formulation of a risk management strategy for protection and conservation of cultural heritage, through which to end the plundering of Egypt’s architectural legacy in the Egyptian community (revolutions, 1952 and 2011); and by presenting to its surrounding community the benefits derived from maintaining it.

Keywords: cultural heritage, legal regulation, risk management, preservation

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Authors: T. C. Hsu, H. L. Lin

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Taiwan is mountainous country, 70% of land is covered with mountains. Because of extreme climate, the mountain villages with sensitive and fragile environment often get easily affected by inundation and debris flow from typhoon which brings huge rainfall. Due to inappropriate development, overuse and fewer access roads, occurrence of disaster becomes more frequent through downpour and rescue actions are postponed. However, risk map is generally established through administrative boundaries, the difference of urban and rural area is ignored. The neglect of mountain village characteristics eventually underestimates the importance of factors related to vulnerability and reduces the effectiveness. In disaster management, there are different strategies and actions at each stage. According to different tasks, there will be different risk indices and weights to analyze disaster risk for each stage and then it will contribute to confront threat and reduce impact appropriately on right time. Risk map is important in mitigation, but also in response stage because some factors such as road network will be changed by disaster. This study will use risk assessment to establish risk map of Shanlin District which is mountain village in Kaohsiung as a case study in mitigation and response stage through Analytic Hierarchy Process (AHP). AHP helps to recognize the composition and weights of risk factors in mountain village by experts’ opinions through survey design and is combined with present potential hazard map to produce risk map.

Keywords: risk assessment, mountain village, risk map, analytic hierarchy process

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Authors: Debasis Sarkar

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Clean development mechanism (CDM) can act as an effective instrument for mitigating climate change. This mechanism can effectively reduce the emission of CO2 and other green house gases (GHG). Construction of a mega infrastructure project like underground corridor construction for metro rail operation involves in consumption of substantial quantity of concrete which consumes huge quantity of energy consuming materials like cement and steel. This paper is an attempt to develop an integrated clean development mechanism and risk management approach for sustainable development for an underground corridor metro rail project in India during its construction phase. It was observed that about 35% reduction in CO2 emission can be obtained by adding fly ash as a part replacement of cement. The reduced emission quantity of CO2 which is of the quantum of about 21,646.36 MT would result in cost savings of approximately INR 8.5 million (USD 1,29,878).But construction and operation of such infrastructure projects of the present era are subject to huge risks and uncertainties throughout all the phases of the project, thus reducing the probability of successful completion of the project within stipulated time and cost frame. Thus, an integrated approach of combining CDM with risk management would enable the metro rail authorities to develop a sustainable risk mitigation measure framework to ensure more cost and energy savings and lesser time and cost over-run.

Keywords: clean development mechanism (CDM), infrastructure transportation, project risk management, underground metro rail

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Authors: Eun-Chan Kim, Jeong-Hwan Oh, Seung-Guk Lee

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Billions of tones of ballast water including various aquatic organisms are being carried around the world by ships. When the ballast water is discharged into new environments, some aquatic organisms discharged with ballast water may become invasive and severely disrupt the native ecology. Thus, International Maritime Organization (IMO) adopted the Ballast Water Management Convention in 2004. Regulation A-4 of the convention states that a government in waters under their jurisdiction may grant exemptions to any requirements to ballast water management, but only when they are granted to a ship or ships on a voyage or voyages between specified ports or locations, or to a ship which operates exclusively between specified ports or locations. In order to grant exemptions, risk assessment should be conducted based on the guidelines for risk assessment developed by the IMO. For the risk assessment, it is essential to collect the relevant information and establish a database system. This paper studies the database system for ballast water risk assessment. This database consists of the shipping database, ballast water database, port environment database and species database. The shipping database has been established based on the data collected from the port management information system of Korea Government. For the ballast water database, ballast water discharge has only been estimated by the loading/unloading of the cargoes as the convention has not come into effect yet. The port environment database and species database are being established based on the reference documents, and existing and newly collected monitoring data. This database system has been approved to be a useful system, capable of appropriately analyzing the risk assessment in the all ports of Korea.

Keywords: ballast water, IMO, risk assessment, shipping, environment, species

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Authors: M. Ndaw, G. Mendy, S. Ouya

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Information system risk management helps to reduce or eliminate risk by implementing appropriate controls. In this paper, we propose a quantification model of controls impact on information system risks by automatizing the residual criticality estimation step of FMECA which is based on a inductive reasoning. For this, we defined three equations based on type and maturity of controls. For testing, the values obtained with the model were compared to estimated values given by interlocutors during different working sessions and the result is satisfactory. This model allows an optimal assessment of controls maturity and facilitates risk analysis of information system.

Keywords: information system, risk, control, FMECA method

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Authors: J. Tamosaitiene

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The article focuses on the identification and classification of key risk management criteria that represent the most important sustainability aspects of the construction industry. The construction sector is one of the most important sectors in Lithuania. Nowadays, the assessment of the risk level of a construction project is especially important for the quality of construction projects, the growth of enterprises and the sector. To establish the most important criteria for successful growth of the sector, a questionnaire for experts was developed. The analytic hierarchy process (AHP), the expert judgement method and other multicriteria decision making (MCDM) methods were used to develop the hybrid model. The results were used to develop an integrated knowledge system for the measurement of a risk level particular to construction projects. The article presents a practical case that details the developed system, sustainable aspects, and risk assessment.

Keywords: risk, system, model, construction

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Authors: Freddy Houndekindo

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A study was carried out to evaluate the flood risk in the district of Malanville located along the Niger River. The knowledge produce by this study is useful in the implementation of adaptation and/or mitigation measures to alleviate the impact of the flooding on the populations, the economy and the environment. Over the course of the study, the lack of data in the area of interest has been one of the main challenges encountered. Therefore, in the analysis of the flood hazard different sources of remotely sensed data were used. Moreover, the flood hazard was analysed by applying a 1D hydraulic model: HEC-RAS. After setting up the model for the study area, the different flood scenarios considered were simulated and mapped using ArcGIS and the HEC-GEORAS extension. The result of the simulation gave information about the inundated areas and the water depths at each location. From the analysis of the flood hazard, it was found that between 47% and 50% of the total area of the district of Malanville would be flooded in the different flood scenarios considered, and the water depth varies between 1 and 7 m. The townships of Malanville most at risk of flooding are Momkassa and Galiel, located in a high-risk and very high-risk zone, respectively. Furthermore, the assessment of the flood risk showed that the most vulnerable sector to the inundations is the agricultural sector. Indeed, the cultivated floodplains were the most affected areas by the floodwater in every flood scenarios. Knowing that a high proportion of the population of the district relies on their farmlands in these floodplains for their livelihood, the floods pose a challenge not only to the food security in the area but also to its development.

Keywords: flood risk management, Niger, remote sensing, vulnerability

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Authors: Mert Kıranç, Ekrem Duman, Murat Özbilen

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In order to achieve new product development (NPD) activities on time and within budgetary constraints, the NPD managers need a well-designed methodology. This study intends to create an integrated project management methodology for the ones who focus on new product development projects. In the scope of the study, four different management systems are combined. These systems are called as 'Schedule-oriented Stage-Gate Method, Risk Management, Change Management and Earned Value Management'. New product development term is quite common in many different industries such as defense industry, construction, health care/dental, higher education, fast moving consumer goods, white goods, electronic devices, marketing and advertising and software development. All product manufacturers run against each other’s for introducing a new product to the market. In order to achieve to produce a more competitive product in the market, an optimum project management methodology is chosen, and this methodology is adapted to company culture. The right methodology helps the company to present perfect product to the customers at the right time. The benefits of proposed methodology are discussed as an application by a company. As a result, how the integrated methodology improves the efficiency and how it achieves the success of the project are unfolded.

Keywords: project, project management, management methodology, new product development, risk management, change management, earned value, stage-gate

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Authors: Diana López-Soto, Soumaya Yacout, Francisco Ángel-Bello

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Although inventories are considered as stocks of money sitting on shelve, they are needed in order to secure a constant and continuous production. Therefore, companies need to have control over the amount of inventory in order to find the balance between excessive and shortage of inventory. The classification of items according to certain criteria such as the price, the usage rate and the lead time before arrival allows any company to concentrate its investment in inventory according to certain ranking or priority of items. This makes the decision making process for inventory management easier and more justifiable. The purpose of this paper is to present a new approach for the classification of new items based on the already existing criteria. This approach is called the Logical Analysis of Data (LAD). It is used in this paper to assist the process of ABC items classification based on multiple criteria. LAD is a data mining technique based on Boolean theory that is used for pattern recognition. This technique has been tested in medicine, industry, credit risk analysis, and engineering with remarkable results. An application on ABC inventory classification is presented for the first time, and the results are compared with those obtained when using the well-known AHP technique and the ANN technique. The results show that LAD presented very good classification accuracy.

Keywords: ABC multi-criteria inventory classification, inventory management, multi-class LAD model, multi-criteria classification

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Authors: Pooja Pandey

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The role of communication plays an integral part in the management of any disaster, whether natural or human-induced, both require effective and strategic delivery of information. The way any information is conveyed carries the most weight while dealing with the disaster. Hence, integrating communication strategies in disaster risk management (DRM) are extensively acknowledged however, these integration and planning are missing from the practical books. Researchers are continuously exploring integrated DRM and have established substantial vents between research and implementation of the strategies (gaps between science and policy). For this reason, this paper reviews the communication barriers that obstruct effective management of the disaster. Communication between first responders (government agencies, police, medical services) and the public (people directly affected by the disaster) is most critical and lacks proper delivery during a disaster. And these challenges can only be resolved if the foundation of the problem is properly dealt with, which is resolving the issues within the organizations. Through this study, it was found that it is necessary to build the communication gap between the organizations themselves as most of the hindrances occur during the mitigation, preparedness, response and recovery phase of the disaster. The study is concluded with the main aim to review the communication barriers within and at the organizational, technological, and social levels that impact effective DRM. In the end, some suggestions are made to strengthen the knowledge for future improvement in communication between the responders and their organizations.

Keywords: communication, organization, barriers, first responders, disaster risk management

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Authors: Oduntan Oluwakemi, Obisesan Adekemi Adebisola, Ayo-Bello Taofeeq Ayodeji

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The study examined the factors influencing the adoption of climate-smart agricultural practices among maize farmers in Ondo State, Nigeria. A Multi-stage sampling procedure was used to randomly select one hundred respondents for the study. Primary data were collected from the respondents with the aid of a structured questionnaire and analysed using descriptive statistics and a probit regression model. The results of this study showed that crop diversification was the most adopted climate-smart agricultural practice by the respondents, and adoption of Climate Smart Agricultural practices is still very low among the respondents. Results of probit regression revealed that marital status, access to extension services, farming experience, membership of farmers’ association, and access to credit had a positive influence on the adoption of climate-smart agricultural practices, while age, farm size, and total income had a negative influence. Based on the findings of the study, it was recommended that government should develop suitable policies that will encourage farmers, especially rural farmers, to adopt and utilize Climate Smart Agricultural Practices (CSAP). Equally, the study also recommended government should be geared towards supporting improved extension services, providing on-farm demonstration training, disseminating information about climate-smart agricultural practices, and providing credit facilities through the Agricultural Credit Guarantee Scheme Fund and bank credit to farmers in order to enhance the adoption.

Keywords: adoption, agriculture, climate-smart, farmers, maize, Nigeria

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Authors: Samuel Capintero, Ole H. Petersen

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This paper examines the utilization of public-private partnerships for the building and operation of wastewater treatment plants. Our research focuses on risk allocation in this kind of projects. Our analysis builds on more than hundred wastewater treatment plants built and operated through PPP projects in Aragon (Spain). The paper illustrates the consequences of an inadequate management of construction risk and an unsuitable transfer of demand risk in wastewater treatment plants. It also shows that the involvement of many public bodies at local, regional and national level further increases the complexity of this kind of projects and make time delays more likely.

Keywords: wastewater, treatment plants, PPP, construction

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Authors: R. A. Temah, L. A. Nkengla-Asi

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Planning for future disasters sets the stage for a variety of activities that may trigger multiple recurring operations and expose the community to opportunities to minimize risks. Local communities are increasingly embracing the necessity for planning based on local risks, but are also significantly challenged to effectively plan and response to disasters. This research examines basic risk-based disaster planning model and compares it with advanced risk-based planning that introduces the identification and alignment of varieties of local capabilities within and out of the local community that can be pivotal to facilitate the management of local risks and cascading effects prior to a disaster. A critical review shows that the identification and alignment of capabilities can potentially enhance risk-based disaster planning. A tailored holistic approach to risk based disaster planning is pivotal to enhance collective action and a reduction in disaster collective cost.

Keywords: capabilities, disaster planning, hazards, local community, risk-based

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Authors: Elena M. Capitanul, Carlos A. Nunes Cosenza, Walid El Moudani, Felix Mora Camino

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The construction of a new airport or the extension of an existing one requires massive investments and many times public private partnerships were considered in order to make feasible such projects. One characteristic of these projects is uncertainty with respect to financial and environmental impacts on the medium to long term. Another one is the multistage nature of these types of projects. While many airport development projects have been a success, some others have turned into a nightmare for their promoters. This communication puts forward a new approach for airport investment risk assessment. The approach takes explicitly into account the degree of uncertainty in activity levels prediction and proposes milestones for the different stages of the project for minimizing risk. Uncertainty is represented through fuzzy dual theory and risk management is performed using dynamic programming. An illustration of the proposed approach is provided.

Keywords: airports, fuzzy logic, risk, uncertainty

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Authors: Laxman Budhathoki, Lal Bahadur Shrestha, K. C. Laxman

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Hundreds of people are being lost their life by flood disaster in Nepal every year. Community-based disaster management committee has formed to formulate the disaster management plan including the component of EWS like EWS tower, rain gauge station, flood gauge station, culverts, boats, ropes, life jackets, a communication mechanism, emergency shelter, Spur, dykes, dam, evacuation route, emergency dry food management etc. Now EWS become a successful tool to decrease the human casualty from 13 to 0 every year in Rapti River of Chitwan District.

Keywords: disaster risk reduction, early warning system, flood, participatory approach

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Authors: Thomas Doutre, Emmanuel De Meric De Bellefon

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This paper describes the application of local-search metaheuristic quantum annealing to portfolio opti- mization. Heuristic technics are particularly handy when Markowitz’ classical Mean-Variance problem is enriched with additional realistic constraints. Once tailored to the problem, computational experiments on real collected data have shown the superiority of quantum annealing over simulated annealing for this constrained optimization problem, taking advantages of quantum effects such as tunnelling.

Keywords: optimization, portfolio risk management, quantum annealing, metaheuristic

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Authors: Ahmad Dahlan Salleh, Nik Abdul Rahim Nik Abdul Ghani, Muhamad Firdaus M. Hatta

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Risk management has implications on pricing, governance arrangements, business practices and strategy. Nowadays, home financing contract offers more in the risk transfer form to increase bank profit. This is parallel with Islamic jurisprudence method al-Kharaj bi al-thaman (gain accompanies liability for loss) and al-ghurm bil ghunm (gain is justified with risk) that determine the matching between risk transfer and returns. Malaysian financing trend is to buy house. Besides, exists transparency lacking risk transfer issues to the clients because of not been informed clearly. Terms and conditions of each financing also do not reflect clearly that the risk has been transferred to the client, justifying a determination price been made. The assumption on risk occurrence is also inaccurate as each risk is different with the type of financing contract. This makes the Islamic Financial Services Act 2013 in providing standards that transparent and consistent can be used by Islamic financial institution less effective. This study examines how far the level of the risk and obligation incurred by bank and client under various Islamic home financing contract. This research is qualitative by using two methods, document analysis, and semi-structured interviews. Document analysis from literature review to identify profile, themes and risk transfer element in home financing from Islamic jurisprudence perspective. This study finds that need to create a risk transfer parameter by banks which are consistent with risk transfer theory according to Islamic jurisprudence. This study has potential to assist the authority in Islamic finance such as The Central Bank of Malaysia (Bank Negara Malaysia) in regulating Islamic banking industry so that the risk transfer valuation in home financing contract based on home financing good practice and determined risk limits.

Keywords: risk transfer, home financing contract, Sharia compliant, Malaysia

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Authors: ChunYi Peng, Wei Hsuan CHeng, Shyh Kuang Ueng

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This study focuses on the application of self-organizing maps (SOM) technology in analyzing credit card transaction data, aiming to enhance the accuracy and efficiency of fraud detection. Som, as an artificial neural network, is particularly suited for pattern recognition and data classification, making it highly effective for the complex and variable nature of credit card transaction data. By analyzing transaction characteristics with SOM, the research identifies abnormal transaction patterns that could indicate potentially fraudulent activities. Moreover, this study has developed a specialized visualization tool to intuitively present the relationships between SOM analysis outcomes and transaction data, aiding financial institution personnel in quickly identifying and responding to potential fraud, thereby reducing financial losses. Additionally, the research explores the integration of SOM technology with composite intelligent system technologies (including finite state machines, fuzzy logic, and decision trees) to further improve fraud detection accuracy. This multimodal approach provides a comprehensive perspective for identifying and understanding various types of fraud within credit card transactions. In summary, by integrating SOM technology with visualization tools and composite intelligent system technologies, this research offers a more effective method of fraud detection for the financial industry, not only enhancing detection accuracy but also deepening the overall understanding of fraudulent activities.

Keywords: self-organizing map technology, fraud detection, information visualization, data analysis, composite intelligent system technologies, decision support technologies

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Authors: Shervin Alaei, Reza Moradi

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Trading in financial markets is subject to risks due to their high volatilities. Here, using an LSTM neural network, and by doing some risk-based feature engineering tasks, we developed a method that can accurately predict trends of the Tehran stock exchange market index from a few days ago. Our test results have shown that the proposed method with an average prediction accuracy of more than 94% is superior to the other common machine learning algorithms. To the best of our knowledge, this is the first work incorporating deep learning and risk factors to accurately predict market trends.

Keywords: deep learning, LSTM, trend prediction, risk management, artificial neural networks

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Authors: Nnadi Ezekiel Ejiofor

Abstract:

The construction industry plays a decisive role in the healthy development of any nation. Not only large but even small construction projects contribute to a country’s economic growth. There is a need for good management to ensure successful delivery and sustainability because of the plethora of risks that have resulted in low-profit margins for contractors, cost and schedule overruns, poor quality delivery, and abandoned projects. This research reviewed Capitalization on Sustainable Risk Management. Questionnaires and oral interviews conducted were utilized as means of data collection. One hundred and ninety-eight (198) large construction firms in Nigeria form the population of this study. 15 (fifteen) companies that emanated from merger and acquisition were used for the study. The instruments used for data collection were a researcher-developed structured questionnaire based on a five-point rating scale, interviews, focus group discussion, and secondary sources (bill of quantities and stock and exchange commission). The instrument was validated by two experts in the field. The reliability of the instrument was established by applying the split-half method. Kendall’s coefficient of concordance was used to test the data, and a degree of agreement was obtained. Data were subjected to descriptive statistics and analyzed using analysis of variance, t-test, and SPSS. The identified impacts of capitalization were an increase in turnover (24.5%), improvement in the image (24.5%), risk reduction (20%), business expansion (17.3%), and geographical spread (13.6%). The study strongly advocates the inclusion of risk management evaluation as part of the construction procurement process.

Keywords: capitalization, project delivery, risks, risk management, sustainability

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Authors: Cinzia Carrodano, Dimitri Konstantas

Abstract:

Risk is part of our lives. In today’s society risk is connected to our safety and safety has become a major priority in our life. Each person lives his/her life based on the evaluation of the risk he/she is ready to accept and sustain, and the level of safety he/she wishes to reach, based on highly personal criteria. The assessment of risk a person takes in a complex environment and the impact of actions of other people’actions and events on our perception of risk are alements to be considered. The concept of Holistic Risk Assessment (HRA) aims in developing a methodology and a model that will allow us to take into account elements outside the direct influence of the individual, and provide a personalized risk assessment. The concept is based on the fact that in the near future, we will be able to gather and process extremely large amounts of data about an individual and his/her environment in real time. The interaction and correlation of these data is the key element of the holistic risk assessment. In this paper, we present the HRA concept and describe the most important elements and considerations.

Keywords: continuous data, dynamic risk, holistic risk assessment, risk concept

Procedia PDF Downloads 87