What is the point of internal loss data? It is so hard to get and it is so hard to use.
When considering enterprise risk management, internal loss data does have a role; but perhaps it is not as sophisticated as some might think. Basically, internal loss data can tell you quite a lot about what has previously gone wrong, but it is rarely complete or accurate. The logic is that, in part, it will tell you about the losses that you generally incur and assist you with working out what budgeted losses should be. But how useful is it? Let’s explore that further.
Internal losses are the losses that arise because of your choice of internal control system. Generally, the weaker your control system, then the higher the level ...
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