easy · Frm Part 2 Operational Risk
An operational risk manager notes that a business unit consistently scores all of its residual risks as 'Green' in its RCSA workshops. However, internal loss data (ILD) shows several material losses over the same period.
This discrepancy most likely indicates which RCSA weakness?
- The exclusion of legal risk from the operational risk taxonomy.
- Excessive reliance on external data scaling.
- A lack of independence and self-assessment bias.
- The model risk inherent in the Loss Distribution Approach (LDA).
Sign up free to see the explanation and track your rank →
More Frm Part 2 Operational Risk practice
- Which of the following describes the 'One Big Loss' principle for heavy-tailed (subexponen
- Under the current Basel Standardized Measurement Approach (SMA) for operational risk, whic
- Which of the following is NOT one of them?
- What is the marginal coefficient for the portion of the BI that exceeds 30 billion euros?
- According to standard regulatory definitions (such as SR 11-7), which three components are
- A material change to a model is most likely to be triggered by which event?
- How long is the historical window required for calculating the average annual operational
- In the Bow-Tie analysis framework, where do 'Preventive Controls' sit relative to the oper