Suppose you have an opportunity to buy a business in town. The prospective seller has provided a set of squeaky-clean financial statements. Based on the financial ratios worked up by your accountant, the price seems fair. Are you good to go?

In Ted Darling’s view, at this point you’re only halfway to making a good decision. Even if the quantitative issues check out nicely, you should still consider the qualitative side of things.

“A lot of us are familiar with financial risk management,” says Darling, Business Risk Management Specialist with Alberta Agriculture and Food in Airdrie. “We take comfort in numbers because there is a whole set of tools we’ve grown up with, like financial statements and ratios, that are based on hard data. That perspective is very important, and financial professionals are great at providing it. But the numbers can only take you so far.”

In this article, learn about the different sides of risk and risk discovery with words.

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