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Risk can be divided into two basic types; business risk and pure (or insurable risk). Of the following, which one(s) fall(s) under business risk?A liability lossB direct property lossC profit lossD personnel-related lossE B and C
题目
Risk can be divided into two basic types; business risk and pure (or insurable risk). Of the following, which one(s) fall(s) under business risk?
A liability loss
B direct property loss
C profit loss
D personnel-related loss
E B and C
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更多“Risk can be divided into two basic types; business risk and pure (or insurable risk). Of the following, which one(s) fall(s) under business risk?A liability lossB direct property lossC profit lossD personnel-related lossE B and C”相关问题
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第1题：
Risk Event Status is defined as _____ .
A Risk Probability x Amount At Stake.
B the severity of the consequences.
C how likely the event is to occur with risk.
D (Cost + Benefit + Business Risk) / Insurable Risk.
E B and C
正确答案：A
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第2题：
Which of the following activities can be considered as part of risk mitigation
A risk identification
B purchasing insurance
C assessment of outcomes
D assessment of probabilities
E C and D only
正确答案：B
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第3题：
Which of the following is most closely associated with business risk:
A profit and loss
B personnel turnover
C workmen's compensation
D liability insurance
E All of the above.
正确答案：A
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第4题：
184 Which of the following activities can be considered as part of risk mitigation
A. risk identification
B. purchasing insurance
C. assessment of outcomes
D. assessment of probabilities
E. C and D only
正确答案：B
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第5题：
108 Project Risk Management is based on which of the following premises:
A. the future is unknown.
B. unknowns can result in risks or opportunities.
C. we cannot control risk events.
D. project risk impact can be measured and controlled
E. All of the above
正确答案：E
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第6题：
70 Risk Event Status is defined as _____ .
A. Risk Probability x Amount At Stake.
B. the severity of the consequences.
C. how likely the event is to occur with risk.
D. (Cost + Benefit + Business Risk) / Insurable Risk.
E. B and C
正确答案：A
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第7题：
6 Which of the following is most closely associated with business risk:
A. profit and loss
B. personnel turnover
C. workmen's compensation
D. liability insurance
E. All of the above
正确答案：A
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第8题：
14 In acceptance sampling, if the sample size is kept the same but the acceptance number is increased, which of the following will be true:
A. buyer's risk will decrease
B. vendor's risk will decrease
C. producer's risk will decrease
D. consumer's risk will increase
E. C and D only
正确答案：E
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第9题：
John Pentanol was appointed as risk manager at H&Z Company a year ago and he decided that his first task was to examine the risks that faced the company. He concluded that the company faced three major risks, which he assessed by examining the impact that would occur if the risk were to materialise. He assessed Risk 1 as being of low potential impact as even if it materialised it would have little effect on the company’s strategy. Risk 2 was assessed as being of medium potential impact whilst a third risk, Risk 3, was assessed as being of very high potential impact.
When John realised the potential impact of Risk 3 materialising, he issued urgent advice to the board to withdraw from the activity that gave rise to Risk 3 being incurred. In the advice he said that the impact of Risk 3 was potentially enormous and it would be irresponsible for H&Z to continue to bear that risk.
The company commercial director, Jane Xylene, said that John Pentanol and his job at H&Z were unnecessary and that risk management was ‘very expensive for the benefits achieved’. She said that all risk managers do is to tell people what can’t be done and that they are pessimists by nature. She said she wanted to see entrepreneurial risk takers in H&Z and not risk managers who, she believed, tended to discourage enterprise.
John replied that it was his job to eliminate all of the highest risks at H&Z Company. He said that all risk was bad and needed to be eliminated if possible. If it couldn’t be eliminated, he said that it should be minimised.
(a) The risk manager has an important role to play in an organisation’s risk management.
Required:
(i) Describe the roles of a risk manager. (4 marks)
(ii) Assess John Pentanol’s understanding of his role. (4 marks)
(b) With reference to a risk assessment framework as appropriate, criticise John’s advice that H&Z should
withdraw from the activity that incurs Risk 3. (6 marks)
(c) Jane Xylene expressed a particular view about the value of risk management in H&Z Company. She also said that she wanted to see ‘entrepreneurial risk takers’.
Required:
(i) Define ‘entrepreneurial risk’ and explain why it is important to accept entrepreneurial risk in business
organisations; (4 marks)
(ii) Critically evaluate Jane Xylene’s view of risk management. (7 marks)
正确答案：(a) (i) Roles of a risk manager
Providing overall leadership, vision and direction, involving the establishment of risk management (RM) policies,
establishing RM systems etc. Seeking opportunities for improvement or tightening of systems.
Developing and promoting RM competences, systems, culture, procedures, protocols and patterns of behaviour. It is
important to understand that risk management is as much about instituting and embedding risk systems as much as
issuing written procedure. The systems must be capable of accurate risk assessment which seem not to be the case at
H&Z as he didn’t account for variables other than impact/hazard.
Reporting on the above to management and risk committee as appropriate. Reporting information should be in a form
able to be used for the generation of external reporting as necessary. John’s issuing of ‘advice’ will usually be less useful
than full reporting information containing all of the information necessary for management to decide on risk policy.Ensuring compliance with relevant codes, regulations, statutes, etc. This may be at national level (e.g. Sarbanes Oxley)
or it may be industry specific. Banks, oil, mining and some parts of the tourism industry, for example, all have internal
risk rules that risk managers are required to comply with.
[Tutorial note: do not reward bullet lists. Study texts both use lists but question says ‘describe’.]
(ii) John Pentanol’s understanding of his role
John appears to misunderstand the role of a risk manager in four ways.
Whereas the establishment of RM policies is usually the most important first step in risk management, John launched
straight into detailed risk assessments (as he saw it). It is much more important, initially, to gain an understanding of
the business, its strategies, controls and risk exposures. The assessment comes once the policy has been put in place.
It is important for the risk manager to report fully on the risks in the organisation and John’s issuing of ‘advice’ will usually
be less useful than full reporting information. Full reporting would contain all of the information necessary for
management to decide on risk policy.
He told Jane Xylene that his role as risk manager involved eliminating ‘all of the highest risks at H&Z Company’ which
is an incorrect view. Jane Xylene was correct to say that entrepreneurial risk was important, for example.
The risk manager is an operational role in a company such as H&Z Company and it will usually be up to senior
management to decide on important matters such as withdrawal from risky activities. John was being presumptuous
and overstepping his role in issuing advice on withdrawal from Risk 3. It is his job to report on risks to senior
management and for them to make such decisions based on the information he provides.(b) Criticise John’s advice
The advice is based on an incomplete and flawed risk assessment. Most simple risk assessment frameworks comprise at least
two variables of which impact or hazard is only one. The other key variable is probability. Risk impact has to be weighed
against probability and the fact that a risk has a high potential impact does not mean the risk should be avoided as long as
the probability is within acceptable limits. It is the weighted combination of hazard/impact and probability that forms the basis
for meaningful risk assessment.
John appears to be very certain of his impact assessments but the case does not tell us on what information the assessment
is made. It is important to recognise that ‘hard’ data is very difficult to obtain on both impact and probability. Both measures
are often made with a degree of assumption and absolute measures such as John’s ranking of Risks 1, 2 and 3 are not as
straightforward as he suggests.
John also overlooks a key strategic reason for H&Z bearing the risks in the first place, which is the return achievable by the
bearing of risk. Every investment and business strategy carries a degree of risk and this must be weighed against the financial
return that can be expected by the bearing of the risk.
(c) (i) Define ‘entrepreneurial risk’
Entrepreneurial risk is the necessary risk associated with any new business venture or opportunity. It is most clearly seen
in entrepreneurial business activity, hence its name. In ‘Ansoff’ terms, entrepreneurial risk is expressed in terms of the
unknowns of the market/customer reception of a new venture or of product uncertainties, for example product design,
construction, etc. There is also entrepreneurial risk in uncertainties concerning the competences and skills of the
entrepreneurs themselves.
Entrepreneurial risk is necessary, as Jane Xylene suggested, because it is from taking these risks that business
opportunities arise. The fact that the opportunity may not be as hoped does not mean it should not be pursued. Any
new product, new market development or new activity is a potential source of entrepreneurial risk but these are also the
sources of future revenue streams and hence growth in company value.(ii) Critically evaluate Jane Xylene’s view of risk management
There are a number of arguments against risk management in general. These arguments apply against the totality of risk
management and also of the employment of inappropriate risk measures.
There is a cost associated with all elements of risk management which must obviously be borne by the company.
Disruption to normal organisational practices and procedures as risk systems are complied with.
Slowing (introducing friction to) the seizing of new business opportunities or the development of internal systems as they
are scrutinised for risk.
‘STOP’ errors can occur as a result of risk management systems where a practice or opportunity has been stopped on
the grounds of its risk when it should have been allowed to proceed. This may be the case with Risk 3 in the case.
(Contrast with ‘GO’ errors which are the opposite of STOP errors.)
There are also arguments for risk management people and systems in H&Z. The most obvious benefit is that an effective
risk system identifies those risks that could detract from the achievements of the company’s strategic objectives. In this
respect, it can prevent costly mistakes by advising against those actions that may lose the company value. It also has
the effect of reassuring investors and capital markets that the company is aware of and is in the process of managing
its risks. Where relevant, risk management is necessary for compliance with codes, listing rules or statutory instruments. -
第10题：
听力原文：Other aspects of operational risk include major failure of information technology systems or events such as major fires or other disasters.
(6)
A．Information technology system can cause operational risk.
B．A major fire can be a cause of operational risk.
C．The most important types of operational risk involve breakdowns in internal controls and corporate governance.
D．Other aspects of operational risk include firing its dealers, lending officers or other staff exceeding their authority or conducting business in an unethical or risky manner.
正确答案：B
解析：单句意思为“其他操作风险包括信息技术系统的失败、火灾及其他灾难性事件。”A、D项表述错误，C项表述正确，但不是录音句子的内容。 -
第11题：
Risk management’s ( ) is to assure uncertainty does not deflect the endeavor from the business goalsA.trend
B.detail
C.objective
D.rule答案：C解析： -
第12题：
Which one is the most important based on the following common elements of a network design？（）
- A、Business needs
- B、Risk analysis
- C、Security policy
- D、Best practices
正确答案:A -
第13题：
Risk event probability is defined as:
A the total number of possible events divided into the expectations or frequency of the risk event
B the number of times the risk event may occur
C the fraction of the total project tasks which may be affected by the risk event
D the total number of possible events divided into the consequences of the risk event.
E A and B
正确答案：A
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第14题：
Which of the following is most closely associated with pure risk:
A profit and loss
B personnel turnover
C insurance
D market fluctuations
E A and D only
正确答案：C
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第15题：
124 Which of the following is most closely associated with business risk:
A. profit and loss
B. personnel turnover
C. workmen's compensation
D. liability insurance
E. All of the above.
正确答案：A
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第16题：
84 Risk can be divided into two basic types; business risk and pure (or insurable risk). Of the following, which one(s) fall(s) under business risk?
A. liability loss
B. direct property loss
C. profit loss
D. personnel-related loss
E. B and C
正确答案：C
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第17题：
144 Risk event probability is defined as:
A. the total number of possible events divided into the expectations or frequency of the risk event
B. the number of times the risk event may occur
C. the fraction of the total project tasks which may be affected by the risk event
D. the total number of possible events divided into the consequences of the risk event.
E. A and B
正确答案：A
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第18题：
100 Pure Risk differs from Business Risks because Pure Risk's _____ .
A. include chances of both profit or loss associated with the business.
B. include chances of loss and no chances for profit associated with the business.
C. must incur personal loss with business liability.
D. must incur business liability associated with loss of pure profit.
E. B and C
正确答案：B
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第19题：
15 Which of the following is most closely associated with pure risk:
A. profit and loss
B. personnel turnover
C. insurance
D. market fluctuations
E. A and D only
正确答案：C
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第20题：
● （） is most closely associated with business risk. （）A. profit and loss B. personnel turnoverC. workmen’s compensation D. liability insurance
正确答案：A
在所给的4个选项中，利润和损失与商业风险的关系最为紧密。 -
第21题：
(b) (i) Discuss the relationship between the concepts of ‘business risk’ and ‘financial statement risk’; and
(4 marks)
正确答案：
(b) (i) Business risk is defined as a threat which could mean that a business fails to meet an ongoing business objective.
Business risks represent problems which are faced by the management of a business, and these problems should be
identified and assessed for their possible impact on the business.
Financial statement risk is the risk that components of the financial statements could be misstated, through inaccurate
or incomplete recording of transactions or disclosure. Financial statement risks therefore represent potential errors or
deliberate misstatements in the published accounts of a business.
There is usually a direct relationship between business risk and financial statement risk. Generally a business risk, if not
addressed by management, will have an impact on specific components of the financial statements. For example, for
Medix Co, declining demand for metal surgical equipment has been identified as a business risk. An associated financial
statement risk is the potential over-valuation of obsolete inventory.
Sometimes business risks have a more general effect on the financial statements. Weak internal systems and controls
are often identified as a business risk. Inadequacies in systems and controls could lead to errors or misstatements in
any area of the financial statements so auditors would perceive this as a general audit risk factor.
Business risks are often linked to going concern issues, because if a business is failing to meet objectives such as cash
generation, or revenue maximisation, then it may struggle to continue in operational existence. In terms of financial
statement risk, going concern is a very specific issue, and the risk is normally the inadequate disclosure of going concern
problems. In the extreme situation where a business is definitely not a going concern, then the risk is that the financial
statements have been prepared on the wrong basis, as in this case the ‘break up basis’ should be used.
Business risk and financial statement risk concepts can both be used by auditors in order to identify areas of the financial
statements likely to be misstated at the year end. The business risk approach places the auditor ‘in the shoes’ of
management, and therefore provides deeper insight into the operations of the business and generates extensive business
understanding. -
第22题：
Risk management’s ( ) is to assure uncertainty does not deflect the endeavor from the business.
A.trend
B.detail
C.objective
D.rule
正确答案：C
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第23题：
Insurance (保险) may be considered a game of risk in which individuals and businesses protect themselves, their families, and their property from possible losses resulting from unpredictable events such as storms, fires, accidents and illnesses. The first rule of the game, devised centuries age, is "share the risk". To play by this rule, many people take a small loss in place of one person′ s taking a large one.
It is a simple idea: an individual pays a small amount of money called a premium (保险费) to an agent who acts on behalf of an insurance company, or underwriter, which holds the individual′s premium and the premiums paid by thousands of others. The individual receives an insurance policy, a promise that if there is a loss to the individual as defined in the policy the insurance company will pay for it. The funds will come from the individual′s premium, the premium paid by others who did not have losses, and money from the company′ s investment of all the premiums. An individual who does not have a loss loses the premium money but purchases what insurance underwriters call "peace of mind". It is a gamble for the customer and the underwriter, but it is built on the first rule of risk that losses are small when shared by many.
The word "policy" in the 2nd paragraph most probably means ___________.A.a risk between individual and insurance company
B.a shared loss
C.an agreement between an individual and an underwriter.
D.a rule made by the individual答案：C解析：词义题。根据题干定位至第二段，“The individual receives an insurance policy，a promise that if there is a loss to the individual as defined in the policy the insurance company will pay for it．”表明policy指的是个人和担保人之间签的协议。故选C。