ARM 401-7 OPERATIONAL RISK UPDATED ACTUAL Questions and
CORRECT Answers
1. Operational Risk the risk of loss resulting from external events or from failed internal processes,
people, or systems
successful firms define, understand, and manage these risks
2. Four categories 1. people risk
in an Op risk 2. process risk
framework 3. systems risk
4. external events
3. People Risk includes risks assoc w/ firms EEs, contractors, vendors, clients, and any others the
firm chooses to include
many of these are insurable hazard risks
4. How does corpo- might encourage risk taking or risk avoidance
rate culture play
a role in manag-
ing people risk?
(ex.)
5. What are the 1. recruitment
six strategies for 2. selection
mitigating peo- 3. training and development
ple risk? 4. performance mngmt
5. incentives
6. succession planning
6. Recruitment identify the appropriate candidates
7. Selection check references; use interviews to identify people w/ risk profiles that match the
firms' risk philosophy
, 8.
2/8
CORRECT Answers
1. Operational Risk the risk of loss resulting from external events or from failed internal processes,
people, or systems
successful firms define, understand, and manage these risks
2. Four categories 1. people risk
in an Op risk 2. process risk
framework 3. systems risk
4. external events
3. People Risk includes risks assoc w/ firms EEs, contractors, vendors, clients, and any others the
firm chooses to include
many of these are insurable hazard risks
4. How does corpo- might encourage risk taking or risk avoidance
rate culture play
a role in manag-
ing people risk?
(ex.)
5. What are the 1. recruitment
six strategies for 2. selection
mitigating peo- 3. training and development
ple risk? 4. performance mngmt
5. incentives
6. succession planning
6. Recruitment identify the appropriate candidates
7. Selection check references; use interviews to identify people w/ risk profiles that match the
firms' risk philosophy
, 8.
2/8
