Sample interview questions: How do you assess and manage operational risk in financial analysis?
Sample answer:
Assessing Operational Risk
- Identify Potential Sources: Review business processes, systems, and organizational structure to identify areas vulnerable to operational risks.
- Analyze Risk Probability and Impact: Use qualitative and quantitative methods to determine the likelihood and potential severity of identified risks.
- Prioritize Risks: Rank risks based on their probability, impact, and potential impact on financial performance.
- Conduct Scenario Analysis: Develop and analyze scenarios to simulate potential operational events and their financial consequences.
- Monitor Key Risk Indicators: Establish metrics and track key risk indicators to monitor changes in operational risk exposure over time.
Managing Operational Risk
- Implement Controls: Develop and implement policies, procedures, and technologies to mitigate identified risks.