FINANCIAL RISK MANAGEMENT AND ITS EFFECT ON THE FINANCIAL STABILITY OF INFORMATION TECHNOLOGY COMPANIES
Keywords:
Financial Risk Management, Information Technology CompaniesAbstract
This research aims to analyze financial risk management and its influence on the financial stability of information technology companies through a literature review. Through reviewing various recent studies and publications, this research identifies the main strategies in financial risk management implemented by information technology companies as well as the positive impact of these practices on the company's financial stability. A literature review shows that effective financial risk management, such as controlling market, credit and liquidity risks, is able to minimize potential losses and increase operational efficiency. Furthermore, this research finds that companies that adopt a proactive approach to risk management tend to have better resilience to economic turmoil and market fluctuations. Financial risk management also provides a competitive advantage by building investor and creditor confidence. Thus, good financial risk management practices are not only important for risk mitigation but are also vital for maintaining and improving the financial stability of information technology companies in the face of rapidly changing industry dynamics. These findings emphasize the importance of implementing strategic and structured financial risk management to support the sustainability and growth of information technology companies.
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