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Financial Risk Management Framework
Identify, measure and treat enterprise financial risks.
Principles
- Measure exposure, not opinion
- Manage gross before hedging net
- Hedge to policy, not to forecast
Capabilities
- Exposure aggregation
- Hedge programme design
- Risk reporting
Operating model
- Monthly risk committee
- Hedge effectiveness review
- Annual policy refresh
Core controls
- Hedge ratio bands
- Sensitivity and stress limits
KPIs
How this framework is measured
Interest Cover
Formula · EBITDA / Interest Expense
Threshold · ≥ 4×
Debt Service Coverage Ratio (DSCR)
Formula · EBITDA / Debt Service
Threshold · ≥ 1.5×
Covenant Headroom
Formula · Actual − Covenant Threshold
Threshold · ≥ 15% of threshold
Knowledge Graph