CRA Regulatory Compliance & Ethical Standards 2

Question 1

Under the Sarbanes-Oxley Act Section 302, which executive is primarily responsible for certifying the accuracy of financial reports?

Accepted Answer

CEO and CFO jointly

Answer

SOX Section 302 requires the CEO and CFO to personally certify the accuracy and completeness of financial reports filed with the SEC.

Question 2

A risk architect discovers that a colleague is deliberately understating loan loss reserves to inflate quarterly earnings. Under ethical standards, the FIRST action should be:

Accepted Answer

Escalate through internal channels such as compliance or audit

Answer

Ethical standards require using internal escalation paths first before considering external reporting, unless internal channels are compromised.

Question 3

The EU's General Data Protection Regulation (GDPR) right to erasure primarily applies when:

Accepted Answer

A data subject withdraws consent and no other legal basis exists

Answer

GDPR Article 17 grants individuals the right to erasure when consent is withdrawn and no overriding legal basis for processing remains.

Question 4

Which Basel III capital buffer is specifically designed to be built up during periods of excessive credit growth and released during downturns?

Accepted Answer

Countercyclical Capital Buffer

Answer

The Countercyclical Capital Buffer (CCyB) is activated by national authorities during periods of excessive credit growth to build resilience.

Question 5

A conflict of interest policy is MOST effective when it includes:

Accepted Answer

Identification, disclosure, and management or recusal procedures

Answer

Effective conflict of interest policies require identifying potential conflicts, disclosing them, and either managing or recusing the affected party.

(CRA) Certified Risk Architect Practice Test

(CRA) Certified Risk Architect Practice Test

CRA Regulatory Compliance & Ethical Standards 2