Risk Management

 
 
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Risk Management Overview:

The consultants at NorthernLights Advisory Services have the capability to assess whether risks faced by a company are manageable or need to be mitigated. We assist clients in understanding the various types of risk and then develop strategies and implementation plans to minimize those risks. We start by evaluating the various risks and then find ways to mitigate them and operate at a desired risk level.

Clients that participate in the renewable energy, oil and gas, and/or utilities industries are faced with many challenges and uncertainties on a daily basis. We evaluate the underlying positions created by complex hard assets, complicated contracts, and other events within the same framework in order to better understand the risk interrelationships that exist. We look at all possible risks faced by a company, including:

Market Risks

  • ŸCommodity (oil prices, gas prices, input commodities, etc.)

  • ŸCompetition

  • ŸDemand/supply

Operating Risks

  • ŸInfrastructure

  • ŸMaintenance

  • ŸHuman error

  • ŸLogistics

  • ŸProcurement

  • ŸQuality control

  • ŸStrategy or business plan

  • ŸVendor

  • ŸContract counterparty

  • ŸTechnological

  • ŸConcentration

  • ŸFiduciary duty

  • ŸHealth and safety

  • ŸEnvironmental

  • ŸLegal

Financial Risks

  • ŸOperating Profit/Loss

  • ŸDebt/equity

  • ŸCapital availability

  • ŸCredit

  • ŸCredit rating

  • ŸInterest rates

  • ŸCurrency

  • ŸAccounting

  • ŸInflation

  • ŸLiquidity

Our Risk Management Services offer the following to our clients.

  • On-site meeting with the client to understand the overall business and to generally understand the types of risks that the company faces.

  • Review of company contracts to assess potential risks.

  • Assessment of the various market risks unique to the company, including:

  • Current and projected company demand for services or products

  • Ability to increase demand

  • Customer characteristics

  • Current competition and how the mix of competition may change in the future

  • Ability to supply services as market changes occur

  • Comprehensive review of operating risks through meetings and review of available company documents.

  • Review of the company’s current financial risks by reviewing financial statements, loan documentation, credit profile, and through meetings with the management team.

  • Development of a report outlining the risks that the company faces and recommendations for mitigation.

  • Action plan to mitigate risks that are deemed to be material.

  • Work closely with existing management to execute action plan to mitigate risks down to acceptable level.

Risk Management Benefits:

NorthernLights Advisory Services provides the following benefits to the clients engaging our Risk Management Services.

  • Assist the client with understanding potential risks and how to mitigate them.

  • Provide the client with options to mitigate or eliminate risks.

  • Provide the client with action plan to reduce risks.

  • Assist the client to execute risk mitigation action plan.