CGFO - FINANCIAL ADMINISTRATION QUESTIONS AND CORRECT ANSWERS

CGFO - FINANCIAL ADMINISTRATION
QUESTIONS AND CORRECT
ANSWERS
AccordingA2toA2GASBA210,A2listA2theA2typesA2ofA2riskA2-A2Ans--Torts
TheftA2ofA2damageA2to,A2orA2destructionA2ofA2assets
BusinessA2interuption
ErrorsA2orA2omissions
Job-relatedA2illnessesA2orA2injuriesA2toA2employees
ActsA2ofA2God
AnyA2otherA2riskA2ofA2lossA2assumedA2underA2aA2policyA2orA2participationA2contractA2issue
dA2byA2aA2publicA2entityA2riskA2pool
RiskA2ofA2lossA2resultingA2whenA2anA2entityA2agreesA2toA2provideA2accidentA2andA2health,A
2dental,A2andA2otherA2medicalA2benefitsA2toA2itsA2employees.


WhatA2areA2theA2twoA2waysA2toA2mangeA2risk?A2-A2Ans--
ManageA2anA2organization'sA2activitiesA2toA2minimizeA2adverseA2effectsA2ofA2certainA2type
sA2ofA2losses
MitigateA2riskA2byA2purchasingA2insurance.

WhatA2areA2threeA2reasonsA2toA2manageA2risk?A2-A2Ans--CreateA2aA2safeA2workplace
PreventA2financialA2losses
ProvideA2stabilityA2(budget)

WhatA2areA2theA2threeA2approachesA2toA2managingA2operationalA2andA2financialA2risk>A2-
A2Ans--InvestmentA2portfolioA2policiesA2(long-termA2andA2short-term)
DiversificationA2strategiesA2(spreadA2risk)
CustodyA2ofA2assetsA2(procedures)

WhatA2areA27A2sourcesA2ofA2risk?A2-A2Ans--Physical
Legal
Operational
Political
Social
Economic
CognitiveA2(I.T.A2hack)

WhatA2areA2threeA2toolsA2toA2minimizeA2risk?A2-A2Ans--RiskA2transferA2-
A2shiftA2theA2burdenA2toA2another,A2purchaseA2insurance,A2orA2riskA2pool,A2levelA2premium
sA2forA2budget
RiskA2retentionA2-A2assumeA2riskA2responsibilitiesA2internally
RiskA2avoidanceA2-A2DoA2notA2provideA2service

,WhatA2areA2theA2fourA2partsA2ofA2aA2RiskA2ManagementA2Program?A2-A2Ans--
RiskA2Identification
RiskA2evaluation
RiskA2treatment
Implementation

InA2theA2caseA2ofA2RiskA2Retention,A2ifA2claimsA2areA2greaterA2thanA2premiumsA2=A2(GainA2
orA2Loss)A2-A2Ans--Loss

InA2theA2caseA2ofA2RiskA2Retention,A2ifA2claimsA2areA2lessA2thanA2premiumsA2=A2(GainA2orA
2Loss)A2-A2Ans--Gain


WhatA2isA2theA2advantagesA2ofA2RiskA2Retention?A2-A2Ans--LowerA2premiums
AlignA2incentives
CreateA2aA2saferA2workA2environment

WhatA2areA2theA2advantagesA2ofA2participatingA2inA2aA2RiskA2Pool?A2-A2Ans--
VehicleA2forA2governmentA2toA2poolA2funds.
AffordableA2costA2throughA2economiesA2ofA2scale
ProvideA2servicesA2toA2reduceA2risk

RiskA2PoolA2-A2PremiumA2=A2-A2Ans--Revenue

DefineA2IBNRA2-A2Ans--IncurredA2butA2notA2reportedA2claims

WhenA2isA2IBNRA2recorded?A2-A2Ans--
RecordA2whenA2eventA2triggersA2coverageA2underA2policy

WhatA2amountA2isA2IBNRA2recorded?A2-A2Ans--
AmountA2basedA2onA2estimateA2toA2settleA2claim.

HowA2isA2IBNRA2recorded?A2-A2Ans--
AsA2anA2accrualA2basedA2onA2probableA2lossA2thatA2canA2beA2reasonablyA2estimated,A2rec
orededA2asA2anA2expense/liability.

HowA2doA2weA2minimizeA2risk?A2-A2Ans--ProvideA2safetyA2inA2theA2workplace
InspectA2buildings
InstallA2extinquishers,A2sprinklers,A2smokeA2detectors
Training

WhatA2threeA2areasA2shouldA2weA2monitorA2forA2risks?A2-A2Ans--One-timeA2projects
GeographyA2(example:A2stormwater)
UniqueA2Services

WhatA2shouldA2aA2RiskA2ManagementA2CommitteeA2accomplish?A2-A2Ans--
CreateA2aA2RiskA2ManagementA2policy

, DevelopA2inspectionA2programs
DesignA2safety
CreateA2claimsA2investigationA2system
IdentifyA2safetyA2measures
DevelopA2disciplinaryA2procedures
EstablishA2reviewA2boards

WhyA2haveA2aA2RiskA2ManagementA2Committee?A2-A2Ans--GetA2staffA2involved
GainA2employeeA2"buy-in"
InvestigateA2seriousA2injuryA2andA2accidentsA2toA2provideA2aA2saferA2environmentA2andA2r
educeA2risk

WhatA2areA2theA2benefitsA2ofA2aA2RiskA2ManagementA2Committee?A2-A2Ans--
ReducedA2lostA2workdays
PreventA2dayA2forA2accidentalA2losses
EliminateA2concernsA2associatedA2withA2futureA2projects

WhatA2areA2theA2benefitsA2ofA2RiskA2TransferA2(Insurance)?A2-A2Ans--
IdentifiesA2andA2assumesA2theA2risk
SetsA2premiumsA2accordinglyA2forA2employerA2toA2purchase

WhatA2areA2someA2ofA2theA2disadvantagesA2ofA2RiskA2TransferA2(Insurance)?A2-A2Ans--
ChangeA2ofA2behaviorA2dueA2toA2purchaseA2ofA2insurance
IndustryA2hasA2incentive

WhatA2areA2threeA2riskA2exposuresA2thatA2canA2beA2transferred?A2-A2Ans--
DamageA2andA2lossA2ofA2propertyA2-A2PropertyA2Insurance
NegligenceA2inA2performanceA2-A2LiabilityA2Insurance
MedicalA2coverageA2forA2jobA2relatedA2injuriesA2-A2Workers'A2Compensation

WhatA2typeA2ofA2riskA2transferA2hasA2theA2largestA2numberA2ofA2claims?A2-A2Ans--
Workers'A2Compensation

ShiftingA2riskA2toA2aA2contractorA2canA2protectA2andA2indemnifyA2againstA2whatA2twoA2type
sA2ofA2loss?A2-A2Ans--DirectA2lossA2(example:A2garbageA2disposal)
IndirectA2lossA2(example:A2worker'sA2comp)

HoldA2harmlessA2provisionsA2canA2protectA2againstA2what?A2-A2Ans--Non-insuranceA2risk
CertainA2situationsA2inA2contract
Negligence
JointA2negligence

AreA2agreementsA2theA2panaceaA2toA2transferA2risk?A2-A2Ans--No.

WhatA2areA2waysA2toA2financeA2risk?A2-A2Ans--PayA2premiums
ContributeA2toA2pool