As to General Risk Management Principles, the Model Code Mentions

question 297

Multiple Choice

As to general risk management principles, the Model Code mentions that the organizationalstructure should ensure independent risk management and controls. Which one of the following is not among those controls?

• A) open and effective communication channels between all levels of staff and cross-functions should be maintained.
• B) regular internal audits should be carried out together with trading and risk management to ensure early identification of internal control weaknesses
• C) complete segregation of duties between the front, middle and back office activities
• D) a separate system for independent monitoring to ensure compliance with the risk management framework should be in place

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Definitions:

Boundary-management Behavior

The actions taken by individuals or groups to manage and maintain the distinction between different roles, tasks, or work and personal life.

Organization-focused Behavior

Actions and attitudes of individuals within an organization that are primarily directed toward supporting organizational goals and success.

Relating

The process of making connections or establishing relationships between people, enabling effective communication and understanding.

Social Capital

The networks of relationships among people who live and work in a particular society, enabling that society to function effectively.