CCB Operational Risk & Control Testing 4

Question 1

A third-party vendor that processes customer data experiences a data breach. Under operational risk frameworks, this event is best classified as:

Accepted Answer

Third-party/vendor operational risk

Answer

Risks arising from third-party service providers are classified as vendor or third-party operational risk, a recognized sub-category of operational risk.

Question 2

Which element is typically NOT included in an operational risk loss event report?

Accepted Answer

Future market price forecasts

Answer

Loss event reports capture historical operational failures; future market price forecasts are unrelated to documenting an operational loss event.

Question 3

A walkthrough of a cash reconciliation process reveals that the same employee both prepares and approves the reconciliation. This is an example of:

Accepted Answer

A segregation of duties violation

Answer

Having one person both prepare and approve a reconciliation violates the principle of segregation of duties, as no independent check exists.

Question 4

When testing controls over a financial reporting process, a compliance professional finds that the control operates 'as designed' but the underlying process still produces errors. What does this indicate?

Accepted Answer

The control is designed effectively but may be insufficient for the risk

Answer

A control can operate as designed yet still be insufficient if its design does not adequately address the risk, highlighting a design deficiency rather than an operating failure.

Question 5

Which of the following is the best indicator that an organization's operational risk culture is strong?

Accepted Answer

Employees proactively report near misses without fear of punishment

Answer

A strong risk culture is characterized by psychological safety and open reporting, where employees voluntarily disclose near misses to prevent future losses.

(CCB) Certified Compliance and Business Specialist Practice Test

(CCB) Certified Compliance and Business Specialist Practice Test

CCB Operational Risk & Control Testing 4