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ACCA Strategic Professional · Strategic Business Leader · Managing, monitoring and mitigating risk

Marlow Freight's board wants to make sure that risk is managed day to day by those who run each depot, rather than being seen as a task for a separate risk department. Under the 'three lines' approach to risk roles, which description best fits the depot managers who own and manage risks in their operations?

Depot managers sit in the first line, because operational management owns and manages risks and controls in its own activities. The second line monitors and challenges, and the third line, internal audit, provides independent assurance to the board.

  1. AFirst line: operational management owns and manages risk and controlsCorrect
  2. BSecond line: risk and compliance functions that monitor and challenge management
  3. CThird line: internal audit giving independent assurance to the board
  4. DExternal assurance providers such as the statutory auditor

Explanation

In the three lines model, operational managers own and manage risks and controls day to day, which is the first line. The second line provides oversight and challenge, and the third line (internal audit) gives independent assurance. Depot managers are therefore first line.

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