Companies modes of operation, Auditing

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Companies Modes of Operation

Some companies (especially small ones) operate without any overtly expressed plan and simply carry out the business as always, responding to market changes as they happen. Such companies are often very adaptable and survive well.

Large companies normally plan their activities in a hierarchal way, as follows:

  • Mission statement
  • Strategic plan
  • Budgets

 

Businesses are at risk if their business objectives are not achieved. It is therefore desirable for the management to identify all business risks and if necessary to amend the plan to accommodate the risks or make contingency plans to survive.

For example, a company which has over reliance on one customer might decide actively to seek new customers or markets, perhaps by acquisition.  Another example would be a company which is totally reliant on is computer system should have backup facilities.


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