ARM Risk Management Framework Principles 2

Question 1

Under ISO 31000, which framework component is at the center and drives all other components?

Accepted Answer

Leadership and commitment

Answer

ISO 31000 places leadership and commitment at the core of the framework, supporting integration, design, implementation, evaluation, and improvement.

Question 2

A company's risk management policy was written five years ago and has never been reviewed despite major market changes. Which ISO 31000 principle is most clearly being violated?

Accepted Answer

Dynamic

Answer

The dynamic principle requires risk management to anticipate, detect, and respond to changes in the internal and external context.

Question 3

In ISO 31000, which three activities together make up risk assessment?

Accepted Answer

Identification, analysis, and evaluation

Answer

ISO 31000 defines risk assessment as the overall process of risk identification, risk analysis, and risk evaluation.

Question 4

Which of the following best describes the purpose of establishing risk criteria?

Accepted Answer

To define the terms of reference against which the significance of risk is evaluated

Answer

Risk criteria set the benchmarks for judging whether a risk is acceptable or needs treatment.

Question 5

An organization adapts its risk framework to fit its size, culture, and objectives rather than copying a competitor's model. Which ISO 31000 principle does this reflect?

Accepted Answer

Customized

Answer

The customized principle states the framework and process should be tailored to the organization's external and internal context and objectives.

ARM - Associate in Risk Management Practice Test

ARM - Associate in Risk Management Practice Test

ARM Risk Management Framework Principles 2