Statistics Regulatory Frameworks & Compliance 3 — Questions and Answers
Question 1: The Paperwork Reduction Act requires federal agencies to obtain OMB approval before collecting information from how many or more persons?
- 5
- 10 (Correct answer)
- 100
- 1000
Correct answer: 10
Under the Paperwork Reduction Act, OMB approval is required for information collections from 10 or more persons.
Question 2: In financial regulation, Value at Risk (VaR) models must comply with which Basel framework requirement regarding backtesting?
- Models must pass 250 trading days of backtesting with fewer than 5 exceptions at the 99% confidence level (Correct answer)
- Models need only 30-day backtesting windows
- Annual external audits replace backtesting requirements
- VaR models are exempt from backtesting under Basel III
Correct answer: Models must pass 250 trading days of backtesting with fewer than 5 exceptions at the 99% confidence level
Basel II/III requires VaR models to be backtested over 250 trading days, with capital multipliers increasing when exceptions exceed 4.
Question 3: Which U.S. law established the requirement for companies to maintain internal controls over financial reporting and have them audited?
- Glass-Steagall Act
- Dodd-Frank Act
- Sarbanes-Oxley Act (Correct answer)
- Securities Exchange Act of 1934
Correct answer: Sarbanes-Oxley Act
Section 404 of Sarbanes-Oxley requires management and external auditors to report on the adequacy of internal controls over financial reporting.
Question 4: When a pharmaceutical company submits a New Drug Application, what statistical significance threshold is conventionally required for pivotal trial results?
- p < 0.10
- p < 0.05 (Correct answer)
- p < 0.01
- p < 0.001
Correct answer: p < 0.05
FDA guidance and industry convention require p < 0.05 in two adequate and well-controlled clinical trials for NDA approval.
Question 5: The EU's General Data Protection Regulation (GDPR) requires data used for statistical research to be subject to which safeguard?
- Encryption with government-held keys
- Technical and organizational measures ensuring data minimization (Correct answer)
- Prior consent from all living data subjects
- Approval from the European Statistical System
Correct answer: Technical and organizational measures ensuring data minimization
GDPR Article 89 allows statistical processing with appropriate safeguards including pseudonymization and data minimization.
Question 6: In environmental regulation, which statistical approach does the EPA use to set National Ambient Air Quality Standards?
- Maximum likelihood estimation of the 50th percentile
- Risk-based standards using specified percentile exposures (Correct answer)
- Simple arithmetic mean of annual measurements
- Geometric mean of all monitoring station readings
Correct answer: Risk-based standards using specified percentile exposures
EPA NAAQS standards are typically set at specific percentiles (e.g., 98th percentile for 24-hour PM2.5) based on health risk assessments.
Question 7: Under FDA 21 CFR Part 11, electronic records used in statistical analysis of clinical trials must have what feature to ensure data integrity?
- Monthly printed backups
- Audit trails that cannot be disabled (Correct answer)
- On-site storage only
- Approval from two independent statisticians
Correct answer: Audit trails that cannot be disabled
21 CFR Part 11 requires secure, computer-generated audit trails that record who changed data, what was changed, and when.
Statistics Regulatory Frameworks & Compliance 3
The Paperwork Reduction Act requires federal agencies to obtain OMB approval before collecting information from how many or more persons?