Chapter 5. Risk Mitigation Study Notes covers the following learning objectives:
Explain different ways firms address their operational risk exposures.
Describe and provide examples of different types of internal controls, and explain the process of internal control design and control testing.
Describe methods to improve the quality of an operational process and reduce the potential for human error.
Explain how operational risk can arise with new products, new business initiatives, or mergers and acquisitions, and describe ways to mitigate these risks.
Identify and describe approaches firms should use to mitigate the impact of operational risk events.
Describe methods for the transfer of operational risks and the management of reputational risk, and assess their effectiveness in different situations.