Which of the following was NOT a factor in the Long Term Capital Management case?

• A.Changes/breakdowns in historical correlations
• B.Inadequate separation of front and back offices
• C.Unwinding of liquid positions at the beginning of major losses
• D.Model risk

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According to the G-30 Study, the risk management infrastructure's funding must be

• A.determined at the Board level without influence by business unit leaders
• B.determined at the Board level with inputs from business unit leaders
• C.determined by business-unit leaders
• D.determined by the regulators

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A risk manager has just completed a risk assessment project. The report has been given to the risk manager's direct supervisor, who refuses to escalate the material issues raised in the report. Further, the direct supervisor edits the report to remove the section describing the material risk, who then submits it to the firm's Executive Committee.
According to the PRMIA Standards of Best Practice, Conduct and Ethics (Code of Conduct), which of the following actions is most appropriate:

• A.The risk manager has submitted the report to their direct supervisor and their obligation ends at this point, nothing further should be done
• B.The risk manager should attempt to resolve the conflict with the direct supervisor, but if that does not work, they should contact the Whistle-Blowing Hotline of the organization. If no such hot-line is in place, they should contact the PRMIA Ethics Committee
• C.Escalation of the issue is against the Code of Conduct because one should respect the administrative structure of the organization
• D.If the risk manager deems it appropriate, he / she should send a copy of the original report to the CEO

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The retrocession insurance cover was provided by

• A.The Fortress Re reinsurers only
• B.The fronting insurance companies
• C.Fortress Re and other insurers
• D.Fortress Re and their reinsurers

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With a PRMIA member's need to reconcile their internal and external responsibility to perform their work in an independent and appropriate fiduciary manner, which of the following options must be taken into consideration when performing risk management duties?

• A.Internal controls, and the expectations of stakeholders, shareholders, and the general public
• B.Only the internal controls and compliance standards
• C.Internal controls of the organization, and the local regulator
• D.The local regulator, internal controls, and shareholders

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