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PRMIA 8004 Exam Overview:
| Certification Vendor: | PRMIA |
| Exam Name: | PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics |
| Exam Number: | 8004 |
| Exam Format: | Multiple Choice, Case Study Based |
| Available Languages: | English |
| Passing Score: | 60% |
| Real Exam Qty: | 24 |
| Exam Price: | USD 275 (members), USD 350 (non-members) |
| Exam Duration: | 90 minutes |
| Certificate Validity Period: | Lifetime (active status requires annual CRL credits) |
| Recommended Training: | PRMIA Code of Conduct & Governance Principles PRMIA Exam IV Study Materials |
| Exam Registration: | Pearson VUE Scheduling PRMIA Official Registration |
| Sample Questions: | PRMIA 8004 Sample Questions |
| Exam Way: | Computer-based: Onsite at Pearson VUE centers or Online Proctored |
| Pre Condition: | PRMIA membership; no required exam order; must meet program eligibility |
| Official Syllabus URL: | https://www.prmia.org/PRM |
PRMIA 8004 Exam Syllabus Topics:
| Section | Weight | Objectives |
|---|---|---|
| PRMIA Principles of Good Governance | 20% | - Risk appetite and accountability - Board and senior management responsibilities - Risk governance frameworks - Transparency and disclosure |
| PRMIA Standards of Best Practice, Conduct and Ethics | 30% | - Ethical decision-making framework - Code of professional conduct - Professional integrity and accountability - Compliance with laws and regulations |
| PRMIA Case Studies | 50% | - Historical risk failure analysis - Risk management lessons learned - Application of risk principles to scenarios - Root cause identification |
PRMIA PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics Sample Questions:
1. Which of the following would have contributed to noticing and preventing Leeson's violations at Barings?
A) More senior level involvement at Barings regarding use of derivatives
B) Separation of front and back offices
C) Recognition that large profits can be an indicator of higher risk
D) All of the above
2. Which of the following should NOT be part of the Risk Management Infrastructure?
A) Be independently staffed and report to an employee who is on the Executive Committee (Operating Committee) but who is NOT a business unit leader
B) Review continually the application of the Principles of Good Governance to the Risk Management Infrastructure, financial accounting and reporting infrastructure and the organization as a whole
C) Define the organization's definition of risk management as articulated by the Board in clear and uncertain terms
D) Include financial risk management, compliance and external reporting and, to the extent that resources allow, should exclude legal or accounting
3. The financial intermediary services provided by Fannie Mae and Freddie Mac were designed to
A) Buy mortgage-backed loans for banks and keep them all on their books, using them as collateral for the US government to borrow
B) Repackage mortgage loans made by banks and sell them on to investors as asset backed securities
C) Compete directly with banks in selling mortgaged to would-be home owners
D) Offer loans directly to the consumer
4. The Chief Risk Officer is responsible for the management of the Risk Management Infrastructure, and as such helps the Board define, and then implements throughout the organization, the risk appetite of the organization.
Which of the following is also the responsibility of the Chief Risk Officer?
A) Acts as sponsor for risk throughout the organization and ensures that a risk culture is implemented, and maintained
B) ensuring that all employees understand the rules and regulations (both internal and external) with which they must comply and the implications, for them and for the organization, of non-compliance
C) Ensures that reporting of risk and governance-related matters are produced in a timely and accurate manner
D) Maintaining appropriate assurance measures to ensure that the Governance and Risk framework of the organization is effective, and, if any shortcomings are discovered, to escalate these to the Board so that remedial action can be taken in an appropriate and timely manner
5. The "normal" credit loss profile of Washington Mutual was increased by which of the following?
A) The general downturn in the economy of the US
B) By lowering its own credit underwriting standards
C) Acquisitions like Long Beach and Providian
D) Catastrophic losses in its own credit card division
Solutions:
| Question # 1 Answer: D | Question # 2 Answer: B | Question # 3 Answer: B | Question # 4 Answer: C | Question # 5 Answer: C |
By Ophelia
