Financial Cost Risk Statement
Financial Cost Risk Statement
Project/Department: [Name]
Date: [Month Day, Year]
Project Overview
Expanding the capacity of our renewable energy plant to increase production by 50%. Includes installing new solar panels and wind turbines.
Risk Analysis
|
Risk |
Likelihood |
Impact |
Justification |
Mitigation Strategy |
|
Cost Overruns |
High |
Medium |
The construction industry is currently experiencing volatility in material costs. |
Allocate a contingency fund of 15% of the total project budget and engage in fixed-price contracts where possible. |
|
Delay in Project Completion |
Medium |
High |
Global supply chain issues have been affecting project timelines consistently. |
Diversify suppliers and maintain a flexible project timeline with contingency plans. |
|
Tech Obsolescence |
Low |
Low |
Current technology in renewable energy tends to remain relevant for 10 years. |
Invest in modular technology that allows for easy upgrades and stay informed about industry advancements. |
Recommendations
The financial risks identified for the project are manageable with appropriate mitigation strategies. It is recommended to proceed with the project, keeping a close watch on the identified risks and regularly reviewing the risk management plan.
