METHODS FOR ASSESSING FINANCIAL RISKS IN THE SYSTEM OF PUBLIC ADMINISTRATION

Abstract

The article notes the importance of state internal financial control as a public administration tool, explores the essence of financial risk in the public administration system. In general, risk management can be viewed as a specific management process consisting of several stages, namely: stage 1 - risk identification (for implementation, it is necessary to have a wide range of practical and theoretical knowledge in this area, qualitative and quantitative approaches); Stage 2 - making a decision regarding the risk assessment method, risk assessment (there are three groups of assessment methods: economic-statistical, expert, analog); Stage 3 - making a decision on methods of influencing the risk (method of managing or avoiding risks, or preventing damage, or redistributing risk, or taking on the risk in accordance with the financial capabilities of the enterprise and the total amount of potential losses); Stage 4 - implementation of the selected methods of influencing the risk and adjusting the risk management system at the enterprise after monitoring the management results. It was found that the second stage has the main influence on the decision-making results, provided that the risk assessment methods and their main techniques (tasks) are correctly compared. As a result of the analysis of existing methods and models for assessing financial risks, it was found that expert methods dominate in practice. In general, it was noted that an effective financial risk management process is an important condition for improving the public administration mechanisms existing in Ukraine. It has been determined that premature monitoring of the effectiveness of all stages of the financial risk management process, taking into account “weak points” forms the basis for timely adaptation to them. The lack of this ability can be the main cause of emerging crisis situations in public administration.