Elimination of the risk and its impact on the reliability of the information presented in financial reporting

The globalization brings positives and negatives. Positives need to be used effectively and efficiently eliminate the negatives. The process of globalization can't be stopped. Current developments and globalization trends in the economy and finance have the effect of increasing the level of risk that affect the internal and external environment of each entity. That's especially true for the financial market and the insurance market. In order to be competitive insurance company must establish an effective risk management system to ensure its financial stability and capital adequacy in line with European rules. The instrument to eliminate the risks arising from its activities is the creation implementation of effective risk management, internal control system and internal audit. For this strategy to be successful it is necessary to have quality the data base and have in place effective controls using IT technologies. The aim of this paper is to examine the process with a focus on the reliability of the information presented on the risks within the external reporting.