FRM Part II · FRM Exam Part II · Risk Reporting
A bank's monthly operational risk report currently goes to all 40 senior managers with the same 60-page content. Managers complain of overload, and a key cyber-incident trend was missed. Which change best improves distribution?
Tailor reports to each audience: concise dashboards highlighting escalated issues for executives, and detailed data for the risk owners responsible. This addresses overload while making sure important trends such as cyber incidents are seen by the right people. Wider distribution or removing trends would not fix the relevance problem.
- ATailor reports by audience, giving executives a concise dashboard with escalated issues and giving risk owners detailed data relevant to their areaCorrect
- BSend the report to more people so no one is left out
- CRemove all trend information to shorten the report
- DMove distribution to quarterly and keep the same content
Explanation
Effective distribution gives each audience content at the right level of detail: summaries and exceptions for senior management, granular data for owners. Widening the distribution or deleting trends worsens overload or removes the information that was missed. Lower frequency with the same content does not address relevance.
Did you get it right without looking?
One question tells you little. A timed set on Risk Reporting shows your real accuracy, how long you take and where you lose marks.
More Risk Reporting questions
- Which feature of an operational risk report is most important for ensuring that it supports timely decision making by senior management?
- A payments bank sets a tolerance of 30 minutes for the maximum tolerable disruption of its card authorisation service. During a test, the fa…
- A bank's operational risk team prepares a monthly report for the board risk committee. The board members have limited time and are not techn…
- A bank's operational risk function produces reports for the board risk committee, business line heads and front-line managers. Which approac…
- A bank's monthly operational risk report to executive management contains 40 KRIs. Analysis shows 28 have been green for over two years, 8 a…
- An operational risk team reports to the board that the number of loss events fell from 400 to 320 year on year, and presents this as an impr…