ARM 400 Actual Exam Latest Update -

ARM 400 Actual Exam Latest Update - 110 Questions and 100% Verified Correct Answers Guaranteed A+

A business impact analysis (BIA) should identify the points in time when the interruption would have the greatest impact, what the operational impact would be, and

• What continuity strategy to use.
• Whether the exposures are external, internal, or project.
• Who should be on the recovery team.

D. What the financial impact would be. - CORRECT ANSWER: D. What the financial

impact would be.

A corporate goal of a not-for-profit corporation most likely includes

• Maximizing the corporation's economic value.
• Maximizing the value of goods or services provided to constituencies.
• Maximizing the corporation's cash flow.
• Maximizing the value of the corporation's total economic value. - CORRECT

ANSWER:B. Maximizing the value of goods or services provided to constituencies.

A holistic approach that allows companies to better withstand short-term shocks and help ensure long-term business viability is known as

• Business process management.
• Strategic redeployment plan.
• Organizational resiliency.

D. Preparedness planning - CORRECT ANSWER: C. Organizational resiliency.

A risk management professional is identifying the organization's key stakeholders as part of the enterprise risk management program. Which one of the following would be considered an internal stakeholder?

• Unions
• General public
• Stockholders

D. Suppliers - CORRECT ANSWER: C. Stockholders

According to the law of large numbers, as the number of exposure units insured increases,

• The size of the average loss declines.
• The relative accuracy of predictions about future losses increases.
• The probability of an underwriting loss increases.
• Fewer losses are expected to occur. - CORRECT ANSWER: B. The relative accuracy

of predictions about future losses increases.

All of the following are true regarding the Federal Sentencing Guidelines, EXCEPT:

• They require an organization to have written standards and procedures. 1 / 3

• They are mandatory.
• They can be used by federal courts.
• They establish minimum components for an effective compliance program. -

CORRECT ANSWER: B. They are mandatory.

AMRM Insurance Company sells insurance in Virginia, North Carolina, South Carolina, and Georgia. The company has compiled a policyowner data base that can be used to send text messages when hurricanes approach. The company provides early warnings, storm updates from the National Weather Service, and hurricane safety measures. The company credits the system with reduced hurricane claims. The use of the texting system is an example of

• Artificial intelligence.
• Preventive analytics.

C. Experie - CORRECT ANSWER: B. Preventive analytics.

An independent auditor has been given the task of evaluating internal controls at Westside Company (Westside). The auditor has determined that Westside's board of directors has endorsed a framework requiring management to have documented internal reporting controls to ensure efficient operations, accuracy of financial statements, and compliance with regulations. The framework is applied at the entity and divisional levels, but not the operating unit or functional levels. The program is new so it

- CORRECT ANSWER: B. The selected method does not align with the Committee of

Sponsoring Organizations of the Treadway Commission's (COSO) Internal Control— Integrated Framework because it must also be applied at the operating unit and functional levels and it must be monitored.

An organization has established a key performance indicator to "reduce employee injuries by 6%." Which one of the following would indicate a low risk tolerance for this KPI?

• Reduce employee injuries by 2%
• Reduce employee injuries by 4%
• Reduce employee injuries by 5 to 6%

D. Employee injury rate remains unchanged - CORRECT ANSWER: C. Reduce

employee injuries by 5 to 6%

An organization's goals and objectives are met by establishing and attaining measurable standards for the many activities it pursues. Which one of the following statements is correct with respect to those standards?

• A key performance indicator (KPI) answers the question, "What will make our

organization a success?"

• Organizations with key performance indicators (KPIs) established for critical success

factors (CSFs) will typically achieve organizational goals.

C. For each key performance ind - CORRECT ANSWER: C. For each key performance

indicator (KPI), there is a tolerance level for how much deviation from the standard established in the KPI will be acceptable.

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An organization's goals and objectives are met by establishing and attaining measurable standards for the many activities it pursues. Which one of the following statements is correct with respect to those standards?

• Organizations with key performance indicators (KPIs) established for critical success

factors (CSFs) will typically achieve organizational goals.

• A key performance indicator (KPI) answers the question, "What will make our

organization a success?"

C. Generally, an organization's - CORRECT ANSWER: D. For each key performance

indicator (KPI), there is a tolerance level for how much deviation from the standard established in the KPI will be acceptable.

Based on Basel III principles, which one of the following groups should take the lead in establishing a strong risk management culture?

• Risk managers
• Board of directors
• Employees

D. Senior management - CORRECT ANSWER: B. Board of directors

Before speaking with a group or individual, the speaker should think about what he or she wants the other person(s) to do as a result of the conversation. Which one of the following steps in the communication process does the speaker complete by doing this?

• Analyze your audience
• Set aside judgement
• Set a clear communication objective

D. Deliver a message the recipient(s) want to hear - CORRECT ANSWER: C. Set a

clear communication objective

Cheryl Babson works in internal control at Software Company. She contacted company security and asked them to immediately go to the office of a software engineer and to detain him. As part of the internal control process, Cheryl had scanning software installed at the company that randomly searched all e-mails and text messages sent from on-site, searching for key words. The scanning software detected the words: "gun," "bomb," "revenge," and "kill" in communications sent from the engineer's offic -

CORRECT ANSWER: C. Natural language processing.

Claim representative Klee is reviewing an auto liability claim concerning a two-car collision that has just been assigned to him. He discovers that the insured was clearly 100 percent at fault for the accident and although nobody was injured, it is company policy for him to set a $500 reserve. Klee sets the reserve and then calls the insured driver involved in the accident for a recorded statement. During the conversation with the insured driver, Klee takes it upon himself to recommend a company - CORRECT

ANSWER:B. Internal and voluntary

Colossal Casualty Insurance Company decided to conduct an internal audit of the company's operations. As part of the internal audit, several fictitious claims were submitted to the claims department to see if the claims would be approved and paid.

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