PRMIA ORM Certificate - 2023 Update 8020 Exam Dumps: Updated Questions & Answers (October 2025)

The facilitator’smain roleis toguide discussions without bias, ensuringobjective risk identification.

PRMIA’sRisk Governance Frameworkhighlightsneutral facilitationas key to effective risk workshops.

Objectivity ensures unbiased risk assessment.

Expressing personal opinions can influence risk ratings, leading todistorted outcomes.

Option A ("Guide the workshop toward a pre-determined conclusion")

Incorrect because risk workshops shoulddiscover risks, not confirm pre-set beliefs.

Option B ("Attendees can override results")

Incorrect asrisk results should be evidence-based, not subject to override.

Option D ("Attend via video connection")

Incorrect asfacilitators must engage actively, making remote facilitation less effective.

Step 1: Role of a Risk Assessment FacilitatorStep 2: Why Option C Is CorrectStep 3: Why the Other Options Are Incorrect

PRMIA Risk Governance Framework– Stresses objectivity in risk assessment facilitation.

PRMIA Risk Identification Best Practices– Encourages unbiased workshops.

PRMIA Risk References Used:

Final Conclusion:Facilitatorsmust remain neutral and objective, makingOption C the correct answer.

Material customer detrimentrefers to service disruptions thatcause financial loss, inability to access essential services, or significant hardship.

PRMIA andUK FCA Operational Resilience Standardsdefine"significant harm" as going beyond inconvenienceto includemonetary or operational distress.

Significant harm occurs when customers face tangible financial or service losses, not just reputational inconvenience.

Regulatory frameworks (e.g.,Basel, FCA, PRMIA) require banks toprotect customers from material disruptions.

Option A ("Low threshold, any complaint")→ Incorrect becausenot all complaints indicate material detriment.

Option B ("Inconvenience and reputational damage")→ Incorrect becausetrue material harm is more than just inconvenience.

Option C ("Financial system resilience")→ Incorrect because thisdescribes systemic financial stability, not customer impact.

Step 1: Definition of Material Customer DetrimentStep 2: Why Option D is CorrectStep 3: Why the Other Options Are Incorrect

PRMIA Operational Resilience Framework– Defines material customer detriment.

UK FCA Operational Resilience Guidelines– Requires firms to minimize severe harm to customers.

PRMIA Risk References Used:

Final Conclusion:Material customer detriment involves actual financial hardship, not just inconvenience, makingOption D the correct answer.

PRMIA and global financial regulators defineclimate riskas the financial, operational, and societal risks arising fromclimate change.

Climate risks impact businesses throughphysical risks(e.g., floods, wildfires) andtransition risks(e.g., regulatory changes, carbon pricing).

Option A ("Climate risk has been moved out of all risk taxonomies due to international agreement")

Incorrect becauseclimate risk is now a central part of risk taxonomies, as emphasized by PRMIA, Basel III, and TCFD.

Option B ("Climate risk refers to the growing impacts of credit risk on the business environment")

Incorrect because credit risk is justone aspectof climate risk, not the full definition.

Option C ("Climate risk refers to change in the business climate during a recession")

Incorrect becauseclimate risk is about environmental change, not economic cycles.

Step 1: Definition of Climate RiskStep 2: Why the Other Options Are Incorrect

PRMIA Climate Risk Guidelines– Defines climate risk as a financial and societal risk due to climate change.

TCFD (Task Force on Climate-Related Financial Disclosures)– Outlines regulatory expectations for climate risk management.

PRMIA Risk References Used:

Final Conclusion:Climate risk involvesphysical and transition risks from climate change, makingOption D the correct answer.

Definition of DORA

TheDigital Operational Resilience Act (DORA)is a regulation by theEuropean Union (EU)aimed atstrengthening the digital resilienceof financial institutions.

It establishesa regulatory framework for managing information and communication technology (ICT) risksin the financial sector.

Key Objectives of DORA

Ensures that financial institutionscan withstand, respond to, and recover from cyber threats and ICT-related disruptions.

Introducesstandards for risk management, incident reporting, and third-party ICT risk oversight.

Why Other Answers Are Incorrect

Option

Explanation

A. Domain for Operational Risk Act.

Incorrect– No such regulation exists under this name.

B. Digital Operational Risk Act.

Incorrect– The official name isDigital Operational Resilience Act(DORA).

C. Daily Operational Resilience Act.

Incorrect– DORA is not focused on daily operations but ratherlong-term digital resilience.

PRMIA Risk Governance & Digital Resilience Standards

European Commission’s Official DORA Regulation

PRMIA References for Verification

TheTSB outagein 2018 was caused by afailed IT migrationfrom its old banking system to a new one.

The transitionlocked millions of customers out of their accounts for weeks, resulting infinancial losses and reputational damage.

TSB attempted tomove customer data to a new banking platform, butserious defects in the migration processled to service failures.

PRMIA andUK Financial Conduct Authority (FCA) reportsconfirmed thatpoor IT risk managementwas a key failure.

Option A ("Liquidity squeeze by hedge-fund")

Incorrect because TSB's failure was due toIT migration issues, not a liquidity crisis.

Option B ("Sub-standard risk pricing and risk management")

Incorrect becausepricing models were not the cause—it was anIT system failure.

Option D ("IT models did not work if prices were discontinuous")

Incorrect as this issue ismore common in high-frequency trading failures, not banking system outages.

Step 1: Understanding the TSB CaseStep 2: Why Option C Is CorrectStep 3: Why the Other Options Are Incorrect

UK FCA Investigation on TSB Incident– Confirms IT migration failure as root cause.

PRMIA IT Risk Management Framework– Highlights risks of major IT transitions.

PRMIA Risk References Used:

Final Conclusion:TheTSB outage was caused by a failed IT migration, makingOption C the correct answer.

ISO 27000is aglobal standard for information security management systems (ISMS), issued by theInternational Organization for Standardization (ISO).

It provides aframework for protecting sensitive informationthrough policies, controls, and risk management practices.

ISO 27001 (part of ISO 27000 series)is one of the most widely recognized certifications forinformation security governance.

It sets guidelines onrisk assessment, incident response, and data protection.

Option A ("ESG investing")

Incorrect becauseISO 27000 deals with cybersecurity, not environmental, social, and governance (ESG) issues.

Option C ("International Risk Management")

Incorrect because ISO 27000 focuses oninformation security, notgeneral risk management.

Option D ("Auditing of financial controls")

Incorrect becausefinancial auditing standards (e.g., SOX, COSO) are separate from information security standards.

Step 1: Definition of ISO 27000Step 2: Why Option B Is CorrectStep 3: Why the Other Options Are Incorrect

ISO 27000 Series Documentation– Defines cybersecurity risk management practices.

PRMIA IT Risk Governance Framework– References ISO 27001 as a cybersecurity standard.

PRMIA Risk References Used:

ESG (Environmental, Social, and Corporate Governance)refers to the three core factors used to evaluate a company's sustainability and ethical impact.

ESG is now akey part of risk management, influencinginvestment decisions, regulatory compliance, and corporate strategy.

Environmental (E): Climate change, carbon emissions, resource management.

Social (S): Diversity & inclusion, labor rights, community engagement.

Governance (G): Board structure, executive pay, corporate ethics.

Option A ("Environmental, Strategy, and Corporate Governance")

Incorrect becauseStrategy is not part of ESG.

Option C ("Enhanced Social Governance")

Incorrect because ESGcovers more than just social governance.

Option D ("Extra Social Governance")

Incorrect as it does not align with the recognized ESG definition.

Step 1: Definition of ESGStep 2: Breakdown of ESG ComponentsStep 3: Why the Other Options Are Incorrect

PRMIA ESG Risk Management Guidelines– Defines ESG factors as Environmental, Social, and Governance.

PRI (Principles for Responsible Investment)– Aligns ESG with financial risk management.

PRMIA Risk References Used:

Financial Crime Risk Management

Managing financial crime requires implementingcontrols, monitoring, and reporting systemsto detect and prevent illegal activities.

Developing red flags and monitoring scenariosallows firms to detect suspicious transactions related tomoney laundering, fraud, and terrorist financing.

Why Answer C is Correct

PRMIA emphasizes thateffective risk management requires proactive monitoring of transactionsusing red flags, transaction patterns, and anomaly detection systems.

This is aligned with Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) regulatory requirements.

Why Other Answers Are Incorrect

Option

Explanation

A. Having the business be a cash-only business and not report any transactions.

Incorrect– Cash-only businesses withno reportingarehigh-riskfor financial crime.

B. The requirements to trace all transactions when they are entered into spreadsheets.

Incorrect– While transaction tracing is important,spreadsheets alone are not an effective control mechanismfor financial crime.

D. Local regulations that allow a bank to not report transactions by family members of the board.

Incorrect– This would violateAML and financial crime regulations, increasing corruption risk.

PRMIA Financial Crime and AML Risk Guidelines

Basel Committee on Financial Crime and Money Laundering

PRMIA References for Verification

Definition of Internal Loss Data (ILD)

Internal Loss Data (ILD)refers tohistorical records of actual operational lossesincurred by a bank.

These losses are used forrisk assessment, capital calculations, and trend analysisunder Basel III’sOperational Risk Framework.

Key Characteristics of ILD

Captures actual past loss events, such as fraud, system failures, and compliance breaches.

Supports the identification of risk trendsand weak control areas.

Used for operational risk capital modeling, along with external loss data and scenario analysis.

Why Other Answers Are Incorrect

Option

Explanation

A. It consists of near miss operational loss incidents of a bank.

Incorrect– ILD capturesactuallosses, while near misses are reported separately.

C. It consists of the Key Risk Indicators of a bank.

Incorrect–KRIs are forward-looking risk metrics, while ILD focuses onhistorical data.

D. It consists of scenario data developed to calculate the future operational loss incidents of a bank.

Incorrect– ILD ishistorical, whereas scenario data is used forpredictive analysis.

Basel III & PRMIA Operational Risk Data Framework

PRMIA Risk Management Standards for ILD

PRMIA References for Verification

A well-designed policy should include:

Scope– Who the policy applies to.

Exception Handling– How and where exceptions should be requested.

Accountability– Who is responsible for enforcement.

A policy must clearly define exceptions and the process for requesting them.

It should also define areas where the policy does not applyto avoid confusion.

Option A ("List of exceptions for board members' families")→ Incorrect because policies should applyconsistently to all stakeholders.

Option B ("List of acceptable fonts and margin types")→ Incorrect becauseformatting is secondary to content clarity.

Option D ("To whom the policy applies and an additional management report")→ Incorrect becausepolicy scope should not include unnecessary reports.

Step 1: Key Elements of a Well-Designed Policy DocumentStep 2: Why Option C is CorrectStep 3: Why the Other Options Are Incorrect

PRMIA Policy Writing Guidelines– Defines policy structure and exception handling.

ISO 19600 Compliance Management Standard– Supports clear, well-documented policies.

PRMIA Risk References Used:

Final Conclusion:A well-designed policy clearly defines exceptions and their handling process, makingOption C the correct answer.