RSK4801 EXAM
PACK.
, ASSIGNMENT 01 RSK4801 - 2020
1. Which of the following statements is correct?
i. Operational risk is firm-specific and non-systematic.
ii. The operational risk of one firm can affect other firms.
iii. The operational losses of one firm can spread to other firms.
iv. The operational loss of one firm cannot spread to other firms
Choose the correct combination.
A. ii, iii
B. iii, iv
C. i, ii
D. i, iv
2. Product risk involve the credit risk of the supplier and buyer, but it is rooted in the
operational risk of supply chain logistics
A. True
B. False
3. Risk can be generally classified into different categories, and not all risk categories are
applicable to every to every organization. In some cases, there is an overlap. Which of
the following are risk categories?
i) Hazard risk: Loss arises from exposures of property, liability or personnel loss
exposures. Hazard risk include property risk, legal risk, personnel risk and
consequential risk.
ii) Operational risk: Loss arises from the categories of people, processes, systems
or controls. Operational risks include people risk, IT risk, management oversight
and business processes.
iii) Financial risk: Loss arises from the effect of market forces on financial assets or
liabilities. Financial risk include credit risk, market risk, price risk and liquidity risk.
iv) Strategic risk: This comes from the trends in the economy and society in general.
Strategic risk include risk resulting from economic and political environments,
demographics and competition.
Choose the correct combination.
A. i, ii, iv
B. i, ii, iii, iv
C. ii, iii, iv
D. i, iii, iv
1
,4. System risk is a subcategory of operational risk. Examples of systems risk include the
following:
i) Failure during the development and system implementation process
ii) Failure in the system itself
iii) Errors in valuation
iv) Inadequate resource
v) Failure to retain key personnel
Choose the correct combination.
A. ii, iv, v
B. ii, iii, iv
C. i, ii, iv
D. i, ii, iii, iv, v
5. The OECD Principles of Corporate Governance states that a risk policy …
A. is the culture of and processes involved in identifying strategic opportunities and
reducing uncertainty.
B. is the first line of defense to establish an appropriate risk and control environment.
C. is linked to the corporate strategy, and specifies the types and degree of risk that a
company is willing to accept in pursuit of its objectives.
D. gives assurance on the business operations and oversight.
6. Which of the following form part of the Basel Committee on banking Supervision’s seven
categories of operational risks losses?
I) Internal fraud, which generates losses because of the intention to disrespect the
internal regulations.
II) External events, which generate losses because of the intention to disrespect the
external regulations.
III) External fraud that generate losses because of the activity of a third party, who
has the intention to damage and disrespect banking regulations.
IV) Risk that arise from the relationship with clients, products and the business
practice.
Choose the correct combination.
A. i, ii, iii, iv
B. i, iii, iv
C. i, ii, iv
D. ii, iii, iv
7. ….risk is considered to be embraced within operational risk.
A. Liquidity
B. Funding
C. Currency
D. Reputation
2
, 8. Which operational risk event in 2005 led to over 1800 death?
A. NE USA power failure
B. Floods in Thailand
C. Hurricane Katrina
D. Terrorist attack on the World Trade Centre
9. ….persuade(s) management to become involved and reach consensus which will drive
the ongoing identification, assessment and control of operational risk.
A. Risk reporting
B. Scenarios
C. Monitoring
D. Risk and control assessment
10. Learning from previous operational risk problems is a fundamental part of operational risk
A. Event analysis
B. Data analysis
C. Data collection
D. Effects analysis
11. Which of the following statements do not clarify operational risk governance based on
developing an effective and consistent operational risk management framework?
i) The operational risk policy of the firm ensures that the board-approved risk
appetite is aligned with its business policy and objectives.
ii) The internal control system or the internal control and monitoring system of a bank
is a continuous process involving the board of directors, senior management and
all levels of personnel.
iii) The operational risk management framework provides the strategic direction and
guidelines on operational risk in order to ensure that an effective operational risk
management and measurement process remains approved
iv) Risk and control ownership and accountability reduce oversight and the
duplication of effort
v) A risk management framework will ensure transparency regarding the risks of the
organization which in turn allows informed business decision making.
Choose the correct combination.
A. ii, iii, iv
B. i, ii, iii, iv, v
C. i, ii, iv
D. i, iii, iv, v
3
PACK.
, ASSIGNMENT 01 RSK4801 - 2020
1. Which of the following statements is correct?
i. Operational risk is firm-specific and non-systematic.
ii. The operational risk of one firm can affect other firms.
iii. The operational losses of one firm can spread to other firms.
iv. The operational loss of one firm cannot spread to other firms
Choose the correct combination.
A. ii, iii
B. iii, iv
C. i, ii
D. i, iv
2. Product risk involve the credit risk of the supplier and buyer, but it is rooted in the
operational risk of supply chain logistics
A. True
B. False
3. Risk can be generally classified into different categories, and not all risk categories are
applicable to every to every organization. In some cases, there is an overlap. Which of
the following are risk categories?
i) Hazard risk: Loss arises from exposures of property, liability or personnel loss
exposures. Hazard risk include property risk, legal risk, personnel risk and
consequential risk.
ii) Operational risk: Loss arises from the categories of people, processes, systems
or controls. Operational risks include people risk, IT risk, management oversight
and business processes.
iii) Financial risk: Loss arises from the effect of market forces on financial assets or
liabilities. Financial risk include credit risk, market risk, price risk and liquidity risk.
iv) Strategic risk: This comes from the trends in the economy and society in general.
Strategic risk include risk resulting from economic and political environments,
demographics and competition.
Choose the correct combination.
A. i, ii, iv
B. i, ii, iii, iv
C. ii, iii, iv
D. i, iii, iv
1
,4. System risk is a subcategory of operational risk. Examples of systems risk include the
following:
i) Failure during the development and system implementation process
ii) Failure in the system itself
iii) Errors in valuation
iv) Inadequate resource
v) Failure to retain key personnel
Choose the correct combination.
A. ii, iv, v
B. ii, iii, iv
C. i, ii, iv
D. i, ii, iii, iv, v
5. The OECD Principles of Corporate Governance states that a risk policy …
A. is the culture of and processes involved in identifying strategic opportunities and
reducing uncertainty.
B. is the first line of defense to establish an appropriate risk and control environment.
C. is linked to the corporate strategy, and specifies the types and degree of risk that a
company is willing to accept in pursuit of its objectives.
D. gives assurance on the business operations and oversight.
6. Which of the following form part of the Basel Committee on banking Supervision’s seven
categories of operational risks losses?
I) Internal fraud, which generates losses because of the intention to disrespect the
internal regulations.
II) External events, which generate losses because of the intention to disrespect the
external regulations.
III) External fraud that generate losses because of the activity of a third party, who
has the intention to damage and disrespect banking regulations.
IV) Risk that arise from the relationship with clients, products and the business
practice.
Choose the correct combination.
A. i, ii, iii, iv
B. i, iii, iv
C. i, ii, iv
D. ii, iii, iv
7. ….risk is considered to be embraced within operational risk.
A. Liquidity
B. Funding
C. Currency
D. Reputation
2
, 8. Which operational risk event in 2005 led to over 1800 death?
A. NE USA power failure
B. Floods in Thailand
C. Hurricane Katrina
D. Terrorist attack on the World Trade Centre
9. ….persuade(s) management to become involved and reach consensus which will drive
the ongoing identification, assessment and control of operational risk.
A. Risk reporting
B. Scenarios
C. Monitoring
D. Risk and control assessment
10. Learning from previous operational risk problems is a fundamental part of operational risk
A. Event analysis
B. Data analysis
C. Data collection
D. Effects analysis
11. Which of the following statements do not clarify operational risk governance based on
developing an effective and consistent operational risk management framework?
i) The operational risk policy of the firm ensures that the board-approved risk
appetite is aligned with its business policy and objectives.
ii) The internal control system or the internal control and monitoring system of a bank
is a continuous process involving the board of directors, senior management and
all levels of personnel.
iii) The operational risk management framework provides the strategic direction and
guidelines on operational risk in order to ensure that an effective operational risk
management and measurement process remains approved
iv) Risk and control ownership and accountability reduce oversight and the
duplication of effort
v) A risk management framework will ensure transparency regarding the risks of the
organization which in turn allows informed business decision making.
Choose the correct combination.
A. ii, iii, iv
B. i, ii, iii, iv, v
C. i, ii, iv
D. i, iii, iv, v
3
