CQIB Questions and Correct Answers

CQIB Questions and Correct
Answers
Three |regulators |of |financial |services |industry:


Ans | FMA, |RBNZ, |Commerce |Commission




CoFR


Ans | FMA< |RBNZ, |Commerce |Commission, |Treasury, |MBIE




Does |the |CoFR |have |regulatory |or |policy |decision |making |powers?


Ans | No
|




Is |the |CoFR |statutory |or |non |statutory


Ans | non |statutory
|




Macro |prudential |risk


Ans | Where |the |fragility |of |a |bank |or |financial |insto |can |affect |the |market |or |economy |as |a

whole
|

,Speculative |risk


Ans | Where |there |is |a |chance |of |loss |or |gain, |based |on |a |decision |to |accept |or |decline |the
|risk




Speculative |risk |eg


Ans | | Horse |racing
|




Absolute |risk


Ans | Where |there |is |a |chance |of |loss |or |no |loss |but |no |gain




Absolute |risk |e.g.


Ans | | Car |crash




Risk |appetite


Ans | The |amount |of |risk |that |an |organisation |is |willing |to |take |to |meet |their |strategic

objectives
|




1st |line |of |risk |defence


Ans | Business
|




operations
|

, Business |operations |as |a |line |of |risk


defence: |Ans
| | - |day |to |day |risk


management |activities
|




- Follow |a |risk |process


- apply |internal |controls |and |risk |responses




risk |and |compliance |functions |as |a |line |of |risk |defence


Ans | - |Review |and |challenge |risk |management
|




processes
|




- Provide |guidance |and |direction


- Dev |risk |management |frameworks




2nd |line |of |risk |defence


Ans | Risk |and |compliance |functions




3rd |line |of |risk |defence


Ans | Internal |audit
|




Internal |audit |as |a |line |of |risk |defence