Strategic Risks in Business Governance
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Questions and Answers

Which of the following is an example of a particular risk?

  • War
  • Car theft (correct)
  • Rapid inflation
  • Natural disaster such as earthquakes
  • Which of the following is a type of enterprise risk?

  • Fundamental risk
  • Liquidity risk (correct)
  • Speculative risk
  • Negligent operation of vehicles
  • Which of the following is an example of a strategic risk faced by an enterprise?

  • Oil exploration (correct)
  • Terrorist attacks
  • Defective products
  • Professional misconduct
  • Which of the following is an example of an operational risk faced by an enterprise?

    <p>Fraud</p> Signup and view all the answers

    Which of the following is an example of a transaction risk faced by an enterprise?

    <p>Negligent operation of vehicles</p> Signup and view all the answers

    Which of the following is a type of financial risk faced by an enterprise?

    <p>Rapid inflation</p> Signup and view all the answers

    What type of risks does strategic risk encompass?

    <p>Poor leadership and ineffective governance</p> Signup and view all the answers

    What is one of the risks associated with inadequate governance mentioned in the text?

    <p>Reputation risk</p> Signup and view all the answers

    Which risk refers to the risk to earnings or capital arising from negative public opinion?

    <p>Reputation risk</p> Signup and view all the answers

    What should businesses do to protect against the risks associated with poor governance structures?

    <p>Comprise boards with the right mix of individuals</p> Signup and view all the answers

    Which of the following is considered an external risk under strategic risks?

    <p>Changes in the business environment</p> Signup and view all the answers

    What is a key aspect of reputation risk, as mentioned in the text?

    <p>It affects an enterprise's ability to access capital</p> Signup and view all the answers

    Which type of risk involves the possibility of a business not being able to meet its financial obligations on time?

    <p>Liquidity risk</p> Signup and view all the answers

    What is a common example of operational risk mentioned in the text?

    <p>Transaction risk</p> Signup and view all the answers

    In the context of operational risks, what does 'inconsistent implementation of programs and strategies' refer to?

    <p>Failure to execute plans effectively</p> Signup and view all the answers

    What type of risk is commonly associated with intentional cheating by an employee or client?

    <p>Fraud risk</p> Signup and view all the answers

    What is the key characteristic of transaction risks in a business?

    <p>Daily occurrence in processing transactions</p> Signup and view all the answers

    Which risk arises from inconsistencies between inventory management system data and accounting system data?

    <p>Operational risk</p> Signup and view all the answers

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