IGNOU BPOI 104 2026 - Credit risk and Internal Control risks

Question

Credit risk and Internal Control risks

09 Feb 2026

Answer :

Word Count : 319

Credit risk in the Order to Cash (O2C) process primarily arises from the possibility that customers may fail to pay their invoices on time or default entirely. This risk directly affects the company’s cash flow, profitability, and overall financial stability. In O2C, credit risk begins with the customer onboarding and credit approval stage, where insufficient assessment of a customer’s financial health, payment history, or creditworthiness can lead to granting excessive credit limits or terms that the customer may not be

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