This quiz works best with JavaScript enabled. Home > Finance > Risk Management > Operational Risk Management – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Operational Risk Management Quiz 1 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What are the affecting factors which influence operational activities as well as the Operational risk ..... A) Nature of the company. B) Laws and regulations. C) Stakeholder Value. D) All the above three factors. Show Answer Correct Answer: D) All the above three factors. 2. What does operational risk management involve? A) Identifying potential risks and implementing measures to mitigate them. B) Analyzing financial data to make investment decisions. C) Developing marketing strategies to attract new customers. D) Creating employee training programs. Show Answer Correct Answer: B) Analyzing financial data to make investment decisions. 3. A business has a poor reputation among customers, this would be considered to be a(n) A) Weakness. B) Strength. C) Threat. D) Opportunity. Show Answer Correct Answer: A) Weakness. 4. What is an important aspect of transporting NJROTC cadets to a drill meet? A) Proper planning and execution. B) Wearing the correct uniform. C) Bringing personal belongings. D) Participating in physical training. Show Answer Correct Answer: B) Wearing the correct uniform. 5. What is Loss Event Reporting (LER)? A) A facilitated process designed to evaluate operational risks, controls and control effectiveness, in order to establish risk profile for the business/support units that can pinpoint significant risk for further monitoring, with a view to change and improve. B) An audit program tool to validate the effectiveness of controls measures by applying sampling checks. C) Tool to monitor and manage key operational risk exposures over time. D) A process for reporting and monitoring operational risk loss incidents including service disruption to system failure, secrecy breach and Shariah Non-Compliance. E) A systematic process in the creation of plausible operational risk events and is an essential element in operational risk management and measurement. It is a forward-looking risk management tool that examines and explores emerging tail-end events, which are usually low frequency and have a high impact. Show Answer Correct Answer: D) A process for reporting and monitoring operational risk loss incidents including service disruption to system failure, secrecy breach and Shariah Non-Compliance. 6. Based on market best practice, which method provides foundation and framework for linking and integrating Operational risk to enterprise Risk Management ..... A) ISO26000. B) ISO31000. C) ISO37000. D) ISO9001. Show Answer Correct Answer: B) ISO31000. 7. "Your" bank in the city of Poso was so badly damaged by the earthquake that it could not operate and had to be immediately moved to an alternate site. That is an example of operational risk due to: A) Process weaknesses. B) System failure. C) Human error. D) External events. Show Answer Correct Answer: D) External events. 8. Risks are events that have not (might) yet occur that have a potential impact on achieving goals. According to this definition, which of the following statements constitutes a risk: A) Experts and regulators predict economic conditions that will enter a crisis period. B) Work accident that caused one employee to be injured. C) Bad loans that do not have collateral. D) Bank ATM damaged due to vandalism. Show Answer Correct Answer: C) Bad loans that do not have collateral. 9. How many types of risk are there? A) 4. B) 2. C) 3. D) None of above. Show Answer Correct Answer: B) 2. 10. Which on eof the following main Risk Management functions statement is FALSE A) Risk Management will provide a framework to assure that operational activities are consistently conducted under control. B) Improve organizational learning. C) Improve the process effectiveness of decision making, planning and prioritizing business or project activity. D) Improve auditing process. Show Answer Correct Answer: D) Improve auditing process. 11. Choose which one is the correct order of numbers as standard ISO31000 process:(1) Risk Treatment(2) extablishing Context(3) Risk Identification(4) Risk Evaluation(5) Risk Analysis A) , (3), (5), (4), (1). B) , (2), (5), (4), (1). C) , (1), (5), (4). D) , (5), (4 , (1), (3). Show Answer Correct Answer: A) , (3), (5), (4), (1). 12. You see two white lights in a line, and one red light off your starboard bow. You should: A) Alter your course to starboard (right). B) Alter your course to port (left). C) Maintain your current course. D) Turn off all lights. Show Answer Correct Answer: A) Alter your course to starboard (right). 13. Inadequacy or non-functioning of the following factors can give rise to Operational Risks, except: A) Human error. B) Internal Events. C) System. D) Proses Internal. Show Answer Correct Answer: B) Internal Events. 14. What is not a definition of risk is as follows: A) The possibility of an unexpected result occurring. B) Potential events that have a negative impact on the Bank's income and capital. C) The probability of a desired outcome occurring. D) Potential losses due to the occurrence of an event. Show Answer Correct Answer: C) The probability of a desired outcome occurring. 15. What is the risk management process? A) Assess risks-Identify risk-Develop controls and make decisions-Implement controls-Supervise and evaluate-. B) Identify risks-Supervise and evaluate-Develop controls and make decisions-Implement controls-Risk assessment-. C) Identify risks-Assess risk-Develop controls and make decisions-Implement controls-Supervise and evaluate-. D) None of above. Show Answer Correct Answer: C) Identify risks-Assess risk-Develop controls and make decisions-Implement controls-Supervise and evaluate-. 16. What is the role of COMPLIANCE TEAM in Operational Risk Management? A) Co-ordinate, facilitate, assess and oversee the effectiveness and integrity of risk management and update Board and Management on risk related matters on timely basis. B) Responsible for the management and control of day to day operational risk. C) Provide independent assurance across all business functions in respect of the effectiveness of the risk management framework. D) None of above. Show Answer Correct Answer: A) Co-ordinate, facilitate, assess and oversee the effectiveness and integrity of risk management and update Board and Management on risk related matters on timely basis. 17. What must be considered to ensure that the cadets arrive on time? A) Transportation logistics. B) Food arrangements. C) Uniform requirements. D) Weather conditions. Show Answer Correct Answer: A) Transportation logistics. 18. There is a fictitious credit at KCP Makmur amounting to IDR 100 million with the method of falsifying the debtor's identity by RM Awal for personal gain. RM Awal reported this incident to Law Enforcement Officials (APH). The risks faced by KCP Makmur were: A) Legal Risk. B) Operational Risk. C) Reputational Risk. D) Business Risk. Show Answer Correct Answer: B) Operational Risk. 19. Risks associated with the use of technology and systems. Currently, all banks are very dependent on systems and technology to support their daily business activities, which is an operational risk because: A) External. B) System. C) People. D) Internal Proses. Show Answer Correct Answer: B) System. 20. !Types of risk are A) Tactical RiskAnnual Risk. B) Technical RiskHorizontal Risk. C) Tactical riskaccidental risk. D) None of above. Show Answer Correct Answer: C) Tactical riskaccidental risk. 21. Which of the following risk statement is catagorized as operational risk ..... A) PEOPLE RISK. B) SYSTEM RISK. C) PROCESS RISK. D) ALL THE STATMENTS. Show Answer Correct Answer: D) ALL THE STATMENTS. 22. To express Operational risk, below statement is FALSE ..... A) They are defined in clear & specific sentence (not more than 10 words). B) Understandable for people with different background. C) Verb Form. D) Avoid specific technical terms/ jargon and avoid abbreviation. Show Answer Correct Answer: C) Verb Form. 23. If the Operational Risk event could not be reported in OpRisk System timely due to system unavailability, Operation Risk Coordinator (ORC) is required to: A) Do nothing. B) Complete the OPERATIONAL RISK EVENT REPORTING FORM and forward it to Group Internal Auditors. C) Complete the OPERATIONAL RISK EVENT REPORTING FORM and forward it to Bank Negara Malaysia. D) Complete the OPERATIONAL RISK EVENT REPORTING FORM and forward it to Group Operation Risk Management. Show Answer Correct Answer: D) Complete the OPERATIONAL RISK EVENT REPORTING FORM and forward it to Group Operation Risk Management. 24. Regarding Risk Loss and Risk Event, which of the following sentences is incorrect: A) Risk loss occurs because of a risk event. B) Risk loss can have both financial and non-financial impacts. C) Risk events occur because of risk loss. D) Risk loss can have an impact on direct or indirect losses. Show Answer Correct Answer: C) Risk events occur because of risk loss. 25. Percentage of debtors with loan age < 6 months collectibility 2 (Special Mention). This is example data: A) Risk & Control Self Assesssment. B) Indication of Fraud Events. C) Loss Event Data. D) Key Risk Indicators. Show Answer Correct Answer: D) Key Risk Indicators. 26. The following is the most appropriate statement to explain KRI. A) KRI is the same as Key Performance Indicators (KPIs). B) KRI measures qualitative operational risk. C) KRI measures the risk exposure faced by banks. D) KRI provides early warnings to identify potential events that could disrupt the continuity of an activity/project. Show Answer Correct Answer: D) KRI provides early warnings to identify potential events that could disrupt the continuity of an activity/project. 27. Which one of the following Risk Management is true:(1) Create and Protect Value(2) Integral parts of Organizational process(3) Part of decision making(4) Inclusive and flexible approach A) All statement are true. B) Only (1) AND (2). C) (1), (2) and (3). D) (1) and (3). Show Answer Correct Answer: C) (1), (2) and (3). 28. What are some notable accomplishments of Henry Kissinger? A) Negotiating the Paris Peace Accords to end the Korean War, receiving the Nobel Peace Prize for his efforts in ending the Korean War, playing a key role in the establishment of diplomatic relations between the United States and Russia, and serving as the United States Secretary of State under Presidents John F. Kennedy and Lyndon B. Johnson. B) Negotiating the Paris Peace Accords to end the Vietnam War, receiving the Nobel Peace Prize for his efforts in ending the Vietnam War, playing a key role in the establishment of diplomatic relations between the United States and China, and serving as the United States Secretary of State under Presidents Richard Nixon and Gerald Ford. C) Negotiating the Paris Peace Accords to end the Cold War, receiving the Nobel Peace Prize for his efforts in ending the Cold War, playing a key role in the establishment of diplomatic relations between the United States and North Korea, and serving as the United States Secretary of State under Presidents Jimmy Carter and Ronald Reagan. D) Negotiating the Paris Peace Accords to end the Gulf War, receiving the Nobel Peace Prize for his efforts in ending the Gulf War, playing a key role in the establishment of diplomatic relations between the United States and Iraq, and serving as the United States Secretary of State under Presidents George H. W. Bush and Bill Clinton. Show Answer Correct Answer: B) Negotiating the Paris Peace Accords to end the Vietnam War, receiving the Nobel Peace Prize for his efforts in ending the Vietnam War, playing a key role in the establishment of diplomatic relations between the United States and China, and serving as the United States Secretary of State under Presidents Richard Nixon and Gerald Ford. 29. When would Risk Management be involved in Operational Process? A) At the begining of execution process. B) At the first strategic decision process. C) At the first initial strategic plan. D) During audit process and BOC meeting. Show Answer Correct Answer: C) At the first initial strategic plan. 30. Risk identification is carried out by analyzing all sources of risk from the Bank's products and activities, taking into account: A) Functional activity coverage. B) The sensitivity of the product/activity to the factors that influence it. C) Risk Appetite dan Risk Tolerance. D) Measurements to be taken. Show Answer Correct Answer: A) Functional activity coverage. Next →Related QuizzesFinance QuizzesOperational Risk Management Quiz 2Credit Risk Management QuizEnterprise Risk Management Quiz 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books