A2: Managing Risks Part 2 (Timed)

DonQuick is a UK based firm that operates 20 major distribution centres across the world. The firm employs over 10,000 staff, the majority of which earn the minimum wage.

Staff are on flexible contracts, which means that DonQuick does not have to guarantee the number of hours that staff will have to work each week. Instead, DonQuick can give employees as many or as little hours as they see fit. This flexible contract mechanism also makes it quite easy for DonQuick to let employees go.

Using a risk severity / likelihood matrix, how would the risk of a staff member leaving be categorised?

Which of the below are counted among the principles that relate to operation under ISO 31000 (select all that apply)? 

In relation to assurance mapping, within the “three lines of defence”, the second line of defence includes (select ALL that apply):

Insurance is considered as which form of risk response?

All the possible outcomes in performance that an organization will experience from its current strategy is referred to as the:

The attitudes towards risk are (select ALL that apply):

The COSO (committee of sponsoring organisations of the treadway commission) enterprise risk management framework is represented in the form of a cube.

Which of the following would be considered a part of the eight components of this framework that must function effectively for risk management to be successful? Select ALL that apply:

PSL is a football league organised by the World Football Association (WFA). The board of the WFA are carrying out a risk assessment for the upcoming league in 20X1.

Drag and drop the appropriate risk mitigation strategies for the scenarios given below:

Reporting suspicions of bribery and corruption within an organization to independent officers who can take appropriate action is known as…………. .

An airline uses IATA (International Air Travel Association – an association of all airlines) standards to decide on its critical success factors and key performance indicators. No machine intervention is used.

Which technique of risk identification is this?

CIMA’s code of ethics identifies five categories of common threats to the five principles.

Match each threat to its correct description:

 May inappropriately influence judgement or behaviour.

From the options below, select the one which shows the correct sequence of steps to be followed to resolve ethical conflicts:

F Ltd is a manufacturer of expensive sports cars. The cars are very fast and larger than most sports cars. It now faces the following threats:

Jiri works with Bank Corp on a credit basis. Apart from a contract clearly defining the credit terms, he has requested a bank guarantee covering the value at risk.

Which form of risk response has Jiri used?  

Medi Labs is a laboratory that provides excellent customer service which is facilitated by skilled staff and state of the art equipment and infrastructure. It has always maintained the highest possible standards of hygiene, safety and equipment.

In recent years the industry in general has been facing several issues. Medi is no exception and it currently faces the following issues:

1) A) Though known as a generous employer, Medi Labs is not able to retain skilled staff for long periods.

2) B) Research materials and equipment are being lost in ever greater quantities.

3) C) The recent controversy over the legality of raw materials has caused strikes in suppliers’ countries and has resulted in supply disruptions. There are many more suppliers available for these materials in other countries though.

Choose from the below options the TWO most appropriate risk management strategies that would best suit Medi Labs.

John Wakefield is the human resources manager of Paltron PLC, he has been asked to draft a job description document for a new risk manager vacancy that has opened up in the firm.

Which of the following would be included as part of the job description of a risk manager? Select ALL that apply:

The support activities underpinning the risk management process under ISO 31000 are (select ALL that apply):

Frank Ltd is a small law firm that specialises in hedge fund transactions. The firm operates in a very small, yet extremely profitable industry.

Everyone who works in Frank Ltd has at least +20 years of experience in legal affairs with hedge funds. There are only 5 members of staff and each of them is given the title of director and given shares in the company to encourage them to bring in their own clients and grow the business. At the moment, each staff member contributes equally to the financial performance of the firm.

The labour turnover ratio for the firm is very low because the average annual salary is $500,000 before taking into account the shares that each staff member owns. As the firm is small, everyone knows each other and the firm has a friendly, knowledge-led culture.

Using a risk severity / likelihood matrix, how would the risk of a staff member leaving be categorised?

Holloway is a London based company building essential utility services all over Africa. In order to guard against exchange rate fluctuations, its contracts contain a clause that all payments must be made in their home currency i.e. GBP.

Which form of risk response has Holloway used?

A procedural approach to risk management includes (select ALL that apply):

From the options given below, select the INCORRECT statement:

Arturo Ltd is a large haulage firm based in the UK, the firm is listed and has a risk committee and an audit committee.

The firm has recently invested a significant amount of capital in purchasing a new fleet of delivery vehicles that will be used to transport goods from the UK all across Europe. The fleet of delivery vehicles will require insurance cover, the firm typically uses an insurance company called Contra PLC to arrange for insurance on their vehicles.

Which of the following people in Arturo Ltd will most likely arrange for the insurance cover of the new fleet of vehicles?

From the options given below, choose the INCORRECT statement with regards to contingency planning?

Which of the following activities would most likely be carried out by a risk committee? Select THREE that apply:

Shakira PLC is a large supermarket chain, the company has supermarkets in over 30 countries across the world and the firm is planning a very large international expansion into Columbia.

Although Shakira PLC is a skilled and successful international operator with a huge amount of resources, the organisation is looking to expand using a joint venture between Shakira and a Brazilian supermarket chain.

The logic for the joint venture structure is that Shakira will be able to bring their highly efficient supply chain and operational experience to the joint venture, whereas the Brazilian operator will be able to contribute an extensive amount of knowledge regarding the local customs of Columbia and the South American market.

Applying the TARA framework to this scenario, what strategy has Shakira PLC adopted in their expansion into Columbia?

The collective wellbeing of the community of people and institutions served by professional accountants is called:

The control environment includes (select ALL that apply):

The range of bearable risk within the extremes of the risk universe is called ………..

From the choices below, choose the option/s that should be considered when facing an ethical dilemma:

From the options below, select the correct combination of two aspects of risk management that were highlighted by IFAC that link risk aversion and risk seeking activities?