CRA Risk Technology and Data Analytics 1

Question 1

What is the primary purpose of a Risk Information System (RIS)?

Accepted Answer

To centralize and manage risk data for reporting and analysis

Answer

A Risk Information System centralizes risk data to support consistent reporting, monitoring, and decision-making across the enterprise.

Question 2

What does a risk dashboard primarily provide to executives?

Accepted Answer

Real-time visibility into key risk exposures and indicators

Answer

Risk dashboards provide executives with real-time visualization of key risk indicators and exposures to support informed decision-making.

Question 3

Why is data quality critical in risk analytics?

Accepted Answer

It ensures accurate and reliable risk measurement and reporting

Answer

High data quality ensures that risk measurements and reports are accurate, enabling reliable risk-based decisions.

Question 4

What does 'data lineage' refer to in risk management?

Accepted Answer

The documented journey of data from source to final report

Answer

Data lineage tracks the origin, movement, and transformation of data, which is critical for validating risk report accuracy and auditability.

Question 5

What is the primary function of Key Risk Indicators (KRIs) in a risk technology system?

Accepted Answer

To provide early warning signals of increasing risk exposure

Answer

KRIs serve as early warning metrics that signal when risk levels are approaching unacceptable thresholds, enabling proactive risk management.

(CRA) Certified Risk Architect Practice Test