ARM 55 - Risk Assessment and
Treatment - Assignment 1
Risk - correct answer ✔The uncertainty about outcomes that can be either
negative or positive.
Risk Management - correct answer ✔The process of making and
implementing decisions that enable an organization to optimize its level of
risk.
Hazard Risk - correct answer ✔Arises from property liability or personnel
loss exposure.
Types of Hazard Risks - correct answer ✔Property Risk, Legal Risk,
Personnel Risk and Consequential Loss.
Operational Risk - correct answer ✔Arises from people, processes, systems,
or controls.
Types of Operation Risks - correct answer ✔People Risk, IT Risk,
Management Oversight and Business Processes.
Financial Risk - correct answer ✔Arises from the effect of the market forces
in financial assets or liabilities.
Types of Financial Risks - correct answer ✔Market Risk, Credit Risk, Price
Risk and Liquidity Risk.
, Strategic Risk - correct answer ✔Arises from trends in the economy and
society.
Types of Strategic Risks - correct answer ✔Economic environment, political
environment, demographics, competition.
Risk Assessment Process - correct answer ✔The process includes risk
identification and risk analysis.
Goals of Risk Assessment - correct answer ✔1. Inform management of Risk
2. Determine how risks can affect objective from being met.
3. Identify potential risk treatment options.
4. Monitor the environment around you at all times.
Risk Appetite - correct answer ✔Total exposed amount of risk a company is
willing to undertake on the basis of risk-return trade-offs for outcomes.
Risk Tolerance - correct answer ✔The amount of uncertainty a company is
willing to accept.
Types of Risk Assessment Approaches - correct answer ✔Top-down and
Bottom-up
Top-down Risk Assessment Approach - correct answer ✔An assessment
that entails senior management and/or the organization's board of directors,
focuses on strategic risk and identify major risks that affect the company.
Treatment - Assignment 1
Risk - correct answer ✔The uncertainty about outcomes that can be either
negative or positive.
Risk Management - correct answer ✔The process of making and
implementing decisions that enable an organization to optimize its level of
risk.
Hazard Risk - correct answer ✔Arises from property liability or personnel
loss exposure.
Types of Hazard Risks - correct answer ✔Property Risk, Legal Risk,
Personnel Risk and Consequential Loss.
Operational Risk - correct answer ✔Arises from people, processes, systems,
or controls.
Types of Operation Risks - correct answer ✔People Risk, IT Risk,
Management Oversight and Business Processes.
Financial Risk - correct answer ✔Arises from the effect of the market forces
in financial assets or liabilities.
Types of Financial Risks - correct answer ✔Market Risk, Credit Risk, Price
Risk and Liquidity Risk.
, Strategic Risk - correct answer ✔Arises from trends in the economy and
society.
Types of Strategic Risks - correct answer ✔Economic environment, political
environment, demographics, competition.
Risk Assessment Process - correct answer ✔The process includes risk
identification and risk analysis.
Goals of Risk Assessment - correct answer ✔1. Inform management of Risk
2. Determine how risks can affect objective from being met.
3. Identify potential risk treatment options.
4. Monitor the environment around you at all times.
Risk Appetite - correct answer ✔Total exposed amount of risk a company is
willing to undertake on the basis of risk-return trade-offs for outcomes.
Risk Tolerance - correct answer ✔The amount of uncertainty a company is
willing to accept.
Types of Risk Assessment Approaches - correct answer ✔Top-down and
Bottom-up
Top-down Risk Assessment Approach - correct answer ✔An assessment
that entails senior management and/or the organization's board of directors,
focuses on strategic risk and identify major risks that affect the company.
