engleski

Application of Cash-Flow-at-Risk Method in Enterprise Risk Analysis – the Case Study of Arena Hospitality Group

Due to the increased dynamics of the business world and business environment in recent years, there is a growing awareness of the importance of risk management, as evidenced by the growing number of organisations seeking to integrate enterprise risk management into their organisational cultures and management systems. The subject of this paper is the analysis of business and business risks of Arena Hospitality Group through simulating the company's cash flows to assess the likelihood of financial difficulties over time by the Cash-flow-at-Risk (CFaR) method. The aim of this paper is to identify and quantify strategic, financial and operational risks related to business and determine which risks have a significant impact on the value of the company and how to protect the company from these risks. The process of data collection and analysis refers to the five-year period ending in 2019, and the forecast includes the period from 2020 to 2024. The process itself begins with a top-down analysis of the external environment, or PESTLE analysis, and builds on the analysis of industry life expectancy, strategic group analysis, and Porter's model of five forces as part of the industry analysis. The elements of the internal business analysis are competitive strategies, financial statements, and SWOT analysis and the ultimate goal is to apply the Cash-flow-at-Risk method. The last part of the paper deals with the exposure of Arena Hospitality Group to business risks which are quantified by the scenario method and the sensitivity analysis method. The scenario method is used to assess the probability of occurrence of the observed risks, while the sensitivity analysis method is used to assess the significance of risk occurrence and the impact on value of the company. The ultimate goal of the risk analysis process, and hence of this paper, is to establish a comprehensive strategy and effective enterprise risk management measures to eliminate the identified risks and reduce them from the company's operations. The analysis will also show the purposefulness and topicality in the fragility of the observed industry which by its nature is crucial for the economy of the Republic of Croatia due to the COVID-19 pandemic.

Case study, Cash-flow-at-Risk, Company analysis, Company evaluation, Risk analysis, Risk management strategy

nije evidentirano