Risk Management in Retail Group

What was the primary motivation for risk management in the retail group?

• To reduce operational costs.

• To increase sales revenue.

• To establish best practice in corporate governance.

• To identify new market opportunities.

Which department was risk management initially a part of in the retail group?

• Finance Department.

• Marketing Department.

• Internal Audit function.

• Human Resources.

What was the reported reason for the recent 'problems with its fundamental controls' in the retail group?

• Economic recession.

• Senior management focusing on refinancing.

• Lack of staff training.

• New competitor entry.

How did the internal audit team initially identify 'risk drivers'?

• Through external consulting reports.

• By analyzing financial statements.

• Through a brainstorming session.

• By reviewing customer complaints.

On what scale did the internal audit team measure the effectiveness of controls during manager interviews?

• 1 to 3.

• 1 to 5.

• 1 to 10.

• Binary (Effective/Ineffective).

How often does the Risk Management Committee (RMC) meet?

• Every month.

• Quarterly.

• Every 2 months.

• Annually.

The 'residual risk' calculated by the RMC is defined as:

• The total potential risk before any controls.

• The monetary value of a fundamental control breakdown.

• The risk after controls have been implemented.

• The probability of a threat arising.

Which of the following was NOT identified as a 'big risk' by the retail group?

• Supply chain.

• Product development.

• People management.

• Systems and business continuity.

What is the purpose of the Key Control Improvement Plan (KCIP)?

• To analyze competitor strategies.

• To provide recommendations to address risks.

• To forecast future sales performance.

• To evaluate staff performance.

What is the monetary threshold for reports to be provided to the RMC and AC?

• Greater than £100,000.

• Greater than £250,000.

• Greater than £500,000.

• Greater than £1,000,000.