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FRM Part II · FRM Exam Part II · Risk Reporting

Which feature of an operational risk report is most important for ensuring that it supports timely decision making by senior management?

Accurate and timely data with clear identification of issues needing action is most important. Reports must be relevant and understandable for the recipient so managers can act promptly; excessive history, technical jargon or one-size-fits-all content reduces their usefulness for decisions.

  1. AInclusion of all historical data since the firm's founding
  2. BUse of technical statistical terminology to demonstrate rigor
  3. CAccuracy and timeliness of data, with clear identification of issues requiring actionCorrect
  4. DUniform content across all recipients regardless of their role

Explanation

Good risk reporting is accurate, timely, clear and relevant to the recipient's needs, and highlights where action is needed. Excess history and jargon reduce clarity, and uniform content ignores differing audience needs.

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